Analyzing the role of fiscal capacity on the relationship between democracy and economic growth
List of Authors
  • Nur Ajrun Khalid , Qinglin Li

Keyword
  • democracy, fiscal capacity, economic growth

Abstract
  • This article continues the discussion on the impact of democracy on growth from the perspective of fiscal capacity by using a fixed effects model to analyze the impact of democracy, fiscal capacity, and economic growth on 22 OECD countries forming the European Union (EU-OECD countries) from 1995 to 2020. The study aims to investigate the factors that can influence and change the relationship between democracy and growth. The research results show that fiscal capacity increases the positive impact of democracy on economic growth. The study provides valuable insights for economists and policymakers interested in promoting democracy and economic growth and recommends that decision-makers prioritize these factors when developing strategies to stimulate economic growth.

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