Alternative Variables for Geography and Institutional Structure: European Colonies and an Evaluation of sub-Saharan African Countries
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Abstract
To explain the main reasons for the differences in economic development among countries, in the main model of this study, we use the malaria index as an instrumental variable to describe the sub-Saharan African countries. In addition, we use the indigenous population density in 1500 and the settler mortality rate as substitutes for each other in different model identifications to demonstrate the settlement conditions in the former European colonial countries, and we use the identity of colonizers to explain today's institutional performance. According to the main model, where we use the two-stage least squares method, the geography of sub-Saharan Africa and institutional structure determine the differences in economic development significantly. In both cases, the coefficients of these variables remain statistically significant, despite minor changes. In addition, estimates of coefficients are the most unbiased estimators among studies using a similar sample. The results of the main model also remained unchanged despite the alternative measures of institutional structure and geography.
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