Working Paper: NBER ID: w9106
Authors: William Easterly; Ross Levine
Abstract: Does economic development depend on geographic endowments like temperate instead of tropical location, the ecological conditions shaping diseases, or an environment good for grains or certain cash crops? Or do these endowments of tropics, germs, and crops affect economic development only through institutions or policies? We test the endowment, institution, and policy views against each other using cross country evidence. We find evidence that tropics, germs, and crops affect development through institutions. We find no evidence that tropics, germs, and crops affect country incomes directly other than through institutions, nor do we find any effect of policies on development once we control for institutions.
Keywords: No keywords provided
JEL Codes: O1; N1; F43
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| tropics, germs, crops (N56) | institutions (D02) |
| institutions (D02) | economic development (O29) |
| tropics, germs, crops (N56) | economic development (O29) |
| policies (D78) | economic development (O29) |