This paper has been revised in the light of the comments made at the Pacific Rim Allied Economic Organizations 4th Biennial Conference, Sydney, Janury 12, 2000, in a Session organized by Darwin C. Hall, California State University, Long Beach. The author thanks the anonymous referees and James Dietz for comments on an earlier version and James Obben, Vilaphonh Xayavong, and Sabine Kerr for helpful suggestions and comments. Any remaining erors are the author's own responsibility.
POLITICAL AND ECONOMIC FREEDOM, FISCAL POLICY, AND GROWTH NEXUS: SOME EMPIRICAL RESULTS FOR FIJI
Article first published online: 18 JUL 2008
Contemporary Economic Policy
Volume 20, Issue 3, pages 234–245, July 2002
How to Cite
Gounder, R. (2002), POLITICAL AND ECONOMIC FREEDOM, FISCAL POLICY, AND GROWTH NEXUS: SOME EMPIRICAL RESULTS FOR FIJI. Contemporary Economic Policy, 20: 234–245. doi: 10.1093/cep/20.3.234
- Issue published online: 18 JUL 2008
- Article first published online: 18 JUL 2008
This article presents an empirical analysis of the relationship between political and civil liberty, economic freedom, and growth for Fiji. Fiji's experience of two military coups in 1987, the delay to resolve the agricultural land lease issues, and the implementation of the 1990 Constitution have been major setbacks in terms of Fiji's nondemocratic political environment and uncertain economic policies, a decline in the private investment and exports, and an exodus of skilled labor. This experience severely damaged the growth prospects whereby unstable sociopolitical institutions undermined the importance of economic freedom and civil liberties of its citizens and foreign investors. Empirical results presented here support the view that democratic values and economic freedom are significant for growth. A statistical test for the endogeneity of democracy variable rejects the null, thus the reverse causality, so democratic environment and economic freedom lead to higher economic growth.