well-defined property rights as captured by the EDB rank are essential for economic progress and result in a high per capita income as seen in Fig. 1.b. This is in contrast to the conventional approach in which the savings rate is seen as critical for growth. Second, however, a high per capita income leads to a reduction in labour supply that slows down growth as seen in Fig. 1.c. Third, countries with low EDB rankings have high growth, but this likely reflects the negative impact of high per capita income on labour supply, etc. Also it should be noted that the EDB rank does not affect growth
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