The effects of economic and political institutions on economic growth in the Middle East: The case of Egypt

This study analyses the effects of economic and political institutions on economic growth through the case of Egypt. The study also evaluates the economic performance of 14 lower middle-income countries, including Egypt, using data from 2002 to 2022. Based on the concept of inclusive and extractive institutions developed by Acemoğlu and Robinson, the study analyses the effects of Egypt's institutional structure on economic growth in detail. While inclusive institutions encourage the participation of broad segments of society in economic and political processes, extractive institutions exclude large segments of the population by protecting the interests of a certain elite group. In the case of Egypt, it has been found that extractive institutions hinder sustainable growth and increase economic inequalities. In the quantitative section, Political Stability and Absence of Violence/Terrorism, and Voice and Accountability indicators have significant and positive effects on the GDP per capita growth rate. It is concluded that political institutions are more effective than economic institutions on growth. The findings of the thesis have important implications for the practical application of Institutional Economics theory and provide policy recommendations for Egypt's economic development process.