The study looks at the role in economic catch-up played by the institutions that defend property law, from the angle of the spread of technology. It argues that as the importance of transaction costs increases in parallel with economic development, the institutions that defend property law and place political power within exogenous constraints gain more value. This proposition is important for the new angle it provides from which to understand better the effect a democratic system of institutions exerts on economic growth. The study supports the statement empirically with panel analysis and regression analysis of the spread of the industrial revolution.
Financed by the National Centre for Research and Development under grant No. SP/I/1/77065/10 by the strategic scientific research and experimental development program:
SYNAT - “Interdisciplinary System for Interactive Scientific and Scientific-Technical Information”.