Economic growth and poverty reduction require for a country to establish efficient rules for economic and political transactions. Poor countries suffer from inadequate, inefficient transaction rules. Formal rules (e.g.,laws,policies) must be nested in hospitable behavioural norms and values....

We examine how institutional and policy reforms affect the relationship between entrepreneurship and growth. We perform Arellano-Bond GMM estimations on annual data (over the period 1990-2002) from a large group of developing countries and focus in particular on the interplay between policy and...