Special-Interest Groups and Growth
31 Pages Posted: 27 Jul 2007 Last revised: 3 Jun 2015
Date Written: March 1, 2010
This paper explores empirically the relation between special-interest groups and economic growth. Our analysis exploits new data on the number of groups observed across countries and time, in order to mitigate the identification problems associated with earlier studies. Also in contrast to earlier work, we examine the impact of groups on two sources of growth - capital accumulation and technological change - in addition to the impact of groups on output growth. The findings are consistent with Olson's (1982) claim that societies with greater numbers of interest groups grow slower, accumulate less capital, and experience reduced productivity growth relative to others.
Keywords: special interest groups, institutional sclerosis, economic growth
JEL Classification: O1, O4, D7
Suggested Citation: Suggested Citation