Determinants of Institutional Quality in Asian Countries
Author: Sadaf

Institutions play a vital role in the economic development of a country. It is an important challenge to take into account those factors that determine quality of institutions. This study attempts to construct different indices of institutional quality using the method of PCA (principle component analysis) and tries to determine their potential determinants from Asian prospective. This analysis is based on panel data involving the time period from 1990-2013 for the Asian countries Pakistan, Sari Lanka, Philippines, India, Bangladesh, Thailand, Singapore, Malaysia, Indonesia, Iran, China and Jordan. The method of two stage least square is employed to analyse the impact of education, social media, population, Gini index, real GDP per capita, taxes and foreign on political, legal, economic and over all institutional quality. From the regression results we came to the conclusion that social media, taxes, GDP per capita and education significantly and positively determines institutional quality(legal, political, economic and overall institutional quality) while population, income inequality and foreign Aid have negative impact on institutional quality. Based on these findings it is recommended that a country with large population should adopt more educational policies ( policies related to the provision of education) or improves its education quality trough different trainings and reforms, if a large part of population is educated and skilled then they can contribute to the development of country. A country should increase GDP per capita in order to meet the demand and challenges of institutions, increase taxes in order to improve institutional quality and decrease dependence on foreign aid. While from the positively significant impact of social media on institutional quality we can conclude that media should be independent from government power so that people can voice their views about the actions taken by the state this will develop a direct relation between state and its citizens. Supervisor:- Dr. Anwar Hussain

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Keywords : Asian Countries, Institutional Quality
Supervisor: Anwar Hussain

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