Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73705
Authors: 
Röhn, Oliver
Orazbayev, Sultan
Sarinzhipov, Aslan
Year of Publication: 
2009
Series/Report no.: 
Ifo Working Paper 70
Abstract: 
This paper investigates the impact of institutions or structural policies on the volatilityof income or GDP per capita in transition countries and in Kazakhstan in particular. Inthe first part of the paper we compare Kazakhstan’s institutional framework with othertransition economies based on a broad range of indicators. Using factor analytical toolsto reduce the dimensionality of the indicator space we find that in general Kazakhstan’sinstitutional quality ranks among the lowest of the 24 transition countries investigated.Reform progress was mainly achieved in infrastructure. In the second part of the paperwe employ state-of-the-art Bayesian Model Averaging (BMA) to identify institutionaland macroeconomic policy areas that have the strongest impact on output volatility intransition economies. The analysis shows that good legal and administrative institutionscan help smooth output volatility. Moreover, we also find that inflation and currentaccount volatility and to a smaller extend exchange rate fluctuations are importantdeterminants of output volatility.
Subjects: 
Institutions
output volatility
development
transitions economies
model uncertainty
Bayesian Model Averaging
JEL: 
E02
E30
O11
P30
Document Type: 
Working Paper

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