The impact of governance indicators on economic growth: The case of G7 and MINT countries

This study examines the impact of governance on economic growth in G7 and MINT countries during the period 1996–2022. The analysis, conducted using the fixed-effects Driscoll-Kraay estimator, reveals that governance makes a positive and significant contribution to economic growth in both groups of countries. In G7 countries, governance significantly supports economic growth through stable institutions and efficient market mechanisms. However, its effect on growth is relatively limited due to the presence of advanced infrastructure and well-established institutional frameworks.In contrast, governance reforms in MINT countries make a more noticeable contribution to economic growth. This is because addressing structural challenges and enhancing governance in MINT countries yields higher marginal returns to growth due to their lower institutional capacities. In conclusion, the positive relationship between governance and economic growth in G7 and MINT countries is confirmed. However, the level and dynamics of this relationship differ according to the economic development levels of the countries. These findings emphasize the importance of governance reforms in supporting economic growth in both groups of countries, while highlighting the need for more comprehensive reforms in MINT countries.