Abstract

The present fiscal difficulties of many countries amplify the call for structural reforms. To provide stylized facts on how reforms worked in the past, we quantitatively review 60 studies estimating the relationship between reforms and growth. These studies examine structural reforms carried out in 26 transition countries around the world. Our results show that an average reform caused substantial costs in the short run, but had strong positive effects on long-run growth. Reforms focused on external liberalization proved to be more beneficial than others in both the short and long run. The findings hold even after correction for publication bias and misspecifications present in some primary studies.

Reference: Jan Babecky & Tomas Havranek (2014), "Structural Reforms and Growth in Transition: A Meta-Analysis." Economics of Transition 22(1), pp. 13-42.

Read the paper

Headline result

Effect of structural reforms on economic growth: reforms in transition countries cost growth in the short run but raise it strongly in the long run, and that holds after correcting for publication bias, based on 60 studies with 537 estimates (Babecky and Havranek 2014, Economics of Transition).

How to cite

Jan Babecky & Tomas Havranek (2014), "Structural Reforms and Growth in Transition: A Meta-Analysis." Economics of Transition 22(1), pp. 13-42.

BibTeX 
@article{babecky2014reforms,
  author  = {Jan Babecky and Tomas Havranek},
  title   = {Structural Reforms and Growth in Transition: A Meta-Analysis},
  journal = {Economics of Transition},
  year    = {2014},
  doi     = {10.1111/ecot.12029},
}