Working Paper: NBER ID: w9560
Authors: Alberto Alesina; Silvia Ardagna; Giuseppe Nicoletti; Fabio Schiantarelli
Abstract: One commonly held view about the difference between continental European countries and other OECD economies, especially the United States, is that the heavy regulation of Europe reduces its growth. Using newly assembled data on regulation in several sectors of many OECD countries, we provide substantial and robust evidence that various measures of regulation in the product market, concerning in particular entry barriers, are negatively related to investment. The implications of our analysis are clear: regulatory reforms, especially those that liberalize entry, are very likely to spur investment.
Keywords: No keywords provided
JEL Codes: A1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| regulatory reforms (G18) | investment (G31) |
| entry barriers (L13) | investment (G31) |
| deregulation (L51) | capital accumulation (E22) |
| liberalization of entry (L59) | private investment (E22) |
| deregulation (L51) | expansion of capital stock (E22) |