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This chapter studies the history of the first generation of indicators of governmental institutional quality. These (international) indicators include labels such as ‘bureaucratic efficiency’ and ‘rule of law.’ This discussion also addresses the argument that it is the reversal, and not the creation, of indicators designed to justify large-scale development policies by leading multilateral agencies that is problematic. This chapter emphasizes the importance of using alternative data sets and making raw data easily available, in order to challenge the present assumptions instead of merely aiming to validate them and the policy choices with which they are associated with.

The huge increase in university graduates from the BRIC countries in recent decades signals their economies' growing global competitiveness. The key for the BRICs' global competitiveness, however, lies less in the number of BRIC graduates than in their quality. Using multiple sources of data gathered from each BRIC country from 2008-2011 and a production function approach, the chapter assesses the evolving capacity of BRIC higher education systems to produce qualified engineering and computer science graduates and compares developments in the quality of undergraduate programs in those fields across elite and non-elite higher education tiers in the BRIC countries. The analysis suggests that in all four countries, a minority of engineering and computer science students receives high quality training in elite institutions while the majority of students receive low quality training in non-elite institutions.

The governance of consultative polities in East Asia lost its place in the process of political and economic liberalization, most notably in managing industrial relations. Democratization ushered in periods of political instability and a new and far more assertive labor movement. The demise of the consultative mechanism unveiled serious coordination problems at the national, industrial, and enterprise levels, and underscored the need for effective bureaucratic and government institutions.

This chapter analyses the relation between institutional quality and FDI. The authors show that firms from countries that have experienced poor domestic institutions are less likely to be deterred from investing in countries with equally weak institutions than firms from the North.

As countries progress, they require more complex institutions; however, economic and institutional processes frequently do not evolve at the same pace, as institutions are subject to greater inertia. This problem is particularly relevant in middle-income countries (MICs), as these countries experience episodes of intense economic growth. Therefore, the absence of institutional change can be a cause of a middle-income trap (MIT). The chapter discusses the criteria that define institutional quality, and examines the various ways in which institutional change occurs. Empirical exploration reveals the existence of two anomalous behaviors in middle-income regions: excessive institutional fluidity in Latin America and, in contrast, an excessive institutional stickiness in MENA. Based on prior works, the author explores the macro determinants of institutional quality. His results suggest that per capita income, tax revenue, redistribution (rather than mere inequality), education, and international openness all appear to be strong determinants of institutional quality.

This chapter presents the methodology of the book's study. For the purpose of this study, Latin American countries were selected because of their common historical origins and culture and their comparable levels of development. The intent was to see if differences existed between a sample of countries that commonly receive comparable scores in cross-national indices of “institutional quality.” The countries included in the study are Argentina, Chile, Colombia, Mexico, and the Dominican Republic. Moreover, the study selected institutions that are emblematic of economic, technical, and social functions deemed fundamental for the proper organization and advancement of most nations. These include stock exchanges, tax authorities, public health services, postal systems, and civil aviation authorities.

This chapter reviews the performance of the Greek economy before and during the global financial crisis. It also presents policy options for Greece going forward, drawing to a significant extent on the conclusions of subsequent chapters. The chapter first studies Greece's economic performance in the decades before the crisis. It discusses the evolution of gross domestic product (GDP) per capita and productivity, debt, consumption, investment, wages and prices. The chapter then turns to the quality of the institutions pertaining to the business environment (product market regulation, justice system, access to finance, and labor market regulation), and to social protection and public good provision (pensions, welfare system, health care, and education). It also identifies interconnections between institutional quality and macroeconomic outcomes.

Significant oil reserves were discovered in Ghana in 2007, and production started in December 2010. Ghana’s astronomically high GDP growth of 15.0% in 2011 was mainly the result of oil production; the non-oil growth rate was 9.4%. Similarly, at 5.4% the growth rate in 2013 was dominated by oil, with the non-oil rate at 3.9%. Petroleum has therefore become a significant component of the Ghanaian economy. This chapter assesses the historical importance of oil in the Ghanaian economy and also presents Ghana’s historical record with non-oil mineral production, assessing how that resource has influenced the general economy and the respective local environments. Further, it examines the institutions put in place in an attempt to avoid the ‘oil curse’ and reviews trends in institutional quality since the inception of petroleum.