the 16/19 threshold. Of these, only _rp∙Z(SYSTEM)_ is robustly significant (PIP > 10/19 _and_ |unconditional mixed t-statistics| > 2).

As an additional test of robustness, all outlier observations were investigated to see if any acted as influential points. These are shown in Table 8. One of these, Jamaica 2006/06, caused _PCT_INT_ to become statistically insignificant at the 10 percent level. All other variables remained significant with or without the other influential points.

||**TABLE7: **|**AGGREGAT**|**EREVENUE**|**DEVIATIO**|**NS, ****_r_**|||
|---|---|---|---|---|---|---|---|
|||**Encomp**|**assing**|**Baye**|**sian**|**Prelimin**|**ary**|
||**Hypothesized**|<br>**Equati**|<br>**on 9a**|<br>**k/K = 1**|<br>**6/19**|<br>**Equation**|<br>**9b**|
||**Signs**|Coeff.|p-value|PIP|Mixed-t|Coeff.|p-value|
||1|2|3|4|5|6|7|
|_Constant_||-2.819|0.894|..|..|14.974|**0.000**|
|_Rp_|+|146.725|**0.081**|0.569|0.721|..|**..**|
|_Rv_|+|-1.438|0.882|..|..|..|**..**|
|_PCT_INT_|−|-0.186|**0.030**|**0.855**|-1.547|-0.121|**0.063**|
|_Rp∙Z(PCT_INT)_|+|-34.324|0.513|..|..|..|**..**|
|**Common Pool**||||||||
|_H01 FACTION_ETHN_|+|0.068|0.162|0.551|0.718|..|**..**|
|_H01 FACTION_LANG_|+|-0.029|0.492|0.345|-0.143|..|**..**|
|_H02 FACTION_RELIG_|+|0.028|0.446|0.339|0.102|..|**..**|
|_H02 DRO_|+|0.525|**0.059**|0.705|1.050|..|**..**|
|_H02 DRY_|+|-0.161|**0.016**|**0.864**|-1.580|-0.141|**0.000**|
|_H03 PCT_CSE_|+|0.135|**0.054**|0.558|0.738|..|**..**|
|**Political Institutions**||..|..|..|..|..|**..**|
|_H04 POLITY_|−|-0.198|0.369|0.484|-0.578|..|**..**|
|_H05 MPP_<br>|−|0.094<br>|**0.088**<br>|0.559|0.717|..|**..**|
|_H06 SYSTEM_|−|0.051|0.982|..|..|..|**..**|
|_H07 PR_|−|-3.430|0.119|0.422|-0.452|..|**..**|
|**Capacity for PFM**||||||||
|_H08 PEFA_|−|2.386|0.332|0.555|0.738|..|**..**|
|_H09 ln(POP)_|−|0.796|0.182|0.693|1.021|..|**..**|
|_H10 ln(GNIPC)_|−|-1.522|0.436|0.404|0.023|..|**..**|
|_H11 ODAGDP_|−|19.252|**0.097**|0.693|1.017|..|**..**|
|**_Interactive Terms_**||||||||
|_H03 Rp∙Z(PCT_CSE)_|+|-30.461|0.438|..|..|..|**..**|
|<br>_H04 Rp∙Z(POLITY)_|+|25.598|0.511|..|..|..|**..**|
|_H05 Rp∙Z(MPP)_|+|-125.702|0.115|0.526|-0.635|..|**..**|
|_H06 Rp∙Z(SYSTEM)_|+|37.413|**0.021**|**0.968**|**2.466**|41.230|**0.000**|
|_H07 Rp∙Z(PR)_|+|-1.242|0.954|..|..|..|**..**|
|_H08 Rp∙Z(PEFA)_|+|-10.548|0.831|..|..|..|**..**|
|_H09 Rp∙Z(lnPOP)_|+|-29.473|0.513|0.421|-0.418|..|**..**|
|<br>_H10 Rp∙Z(lnGNIPC)_|+|134.577|**0.025**|**0.879**|1.673|85.990|**0.000**|
|<br>_BATTLE_|+|0.071|0.867|..|..|..|..|
|_Georgia 2004_||14.717|0.129|||22.632|**0.004**|
|<br>_Ghana 2006_||-66.382|**0.000**|||-50.867|**0.000**|
|_Ghana 2008_||21.522|**0.006**|||23.056|**0.002**|
|_Peru 2007_||37.628|**0.000**|||33.171|**0.000**|
|_Solomon Islands 2004_||50.697|**0.000**|||45.449|**0.000**|
|Observations||144||||144||
|R-squared||0.778||||0.725||
|Adjusted R-squared||0.713||||0.707||
|<br>S.E. of regression||7.342||||7.429||
|<br>Sum squared resid||5,984||||7,394.733||
|<br>Log likelihood||-473||||-487.914||
|F-statistic||12.123|**0.000**|||39.264|**0.000**|
|Normal error term 2/||0.841||||0.556||
|Heteroskedasticity 3/||0.307||||0.654||
|Omitted Variables 4/||0.146||||0.480||

1. Unconditional inclusion.

3. White n∙R<sup>2</sup> probability (without cross terms).

2. Jarque-Bera probability.

4. Ramsey RESET F-statistic probability (1 term).

30