Abstract
31Jul 2016 THE CHASM BETWEEN EXPECTED AND REAL PERFORMANCES OF ROMANIA– A PATH DEPENDENCE OUTCOME. Oana-Ramona Socoliuc , Ion Pohoata and Delia-Elena Diaconasu. Assistant Professor Ph.D., Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Ia?i, Romania. Professor Ph.D., Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Ia?i, Romania. Research Scientist III, Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Ia?i, Romania.
Highlights
N terms of transition preconditions which generated a kind of spillover effect in terms of economic dynamics that is responsible for the existing present disparities under the EU tutelage (Giannaros, 2007; Pohoaţă et al, 2013)
Some innate questions emerge: is the soviet past a reason for the poor economic performances, and if so, how was possible for other ex-soviet nations to overcome this obstacle and to acquire development under European guidance, but not for Romania? Why, here, the European “vaccine” was not able to generate positive outcomes? The purpose of this paper is to provide a pertinent answer to these questions using the institutionalist theory of path dependence
In order to pursue our endeavour of validating the nexus between the quality of formal and informal institutions and economic evolution, we employ econometric analyses such as Granger causality and Vector Error Correction Model, using time series data ranging from 1995 to 2014 on quality institutional and economic development indicators for Romania
Summary
Note: * denotes significant at 5%, ** denotes significant at 10%. The results of the estimated VECM (0,1) meaning zero lags in VECM and one cointegration vector are presented in the following equation: D(GDP_CAP) = - 0.574825530942*(GDP_CAP(-1)+ 1536.16015465*SFI(-1) + 93.249471294*@TREND(95) 16241.4066412) + 101.264052288 + 35.6961816305*@TREND(95) D(SFI) = - 0.000302602171752*(GDP_CAP(-1) + 1536.16015465*SFI(-1) + 93.249471294*@TREND(95) 16241.4066412) - 0.333333333333 + 1.3198936268e-16*@TREND(95). The value of the R-square of 0.264 is acceptable given the fact that we have only two endogenous variables in the system. In order to highlight the influence of one variable to the other one, we performed the variance decomposition.
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