# **Table 4**

Economic Growth and the Role of Violence, Ethnic Fractionalization, and Democracy Cross-country panel data consisting of non-overlapping 5-year averages spanning 1970-2000 Dependent variable: Growth rate of real GDP per capita Estimation method: GMM-IV system estimator

|Variable<br>|[1]|[2]|[3]|[4]|[5]|[6]|
|---|---|---|---|---|---|---|
|Standard Control Variables|||||||
|Initial GDP per Capita<br>( in logs)|-0.0203<br>**<br>-8.3960|-0.0258<br>**<br>-9.0549|-0.0231<br>**<br>-8.8068|-0.0253<br>**<br>-7.6389|-0.1806 **<br>-13.7665|-0.0137<br>**<br>-4.7976|
|Initial GDP per Cap ta<br>i<br>Cyclical Component|-0.1656<br>**<br>-14.2273|-0.1649<br>**<br>-14.8897|-0.1639<br>**<br>-13.0319|-0.1631<br>**<br>-14.3485|-0.1806 **<br>-13.7665|-0.1876<br>**<br>-15.4582|
|Inflation<br>|-0.0165<br>**|-0.0217<br>**|-0.0173<br>**|-0.0208<br>**|-0.0226 **|-0.0228<br>**|
|( Log of Inflation + 100)|-8.0507|-13.0093|-7.5745|-11.8699|-10.4249|-10.6693|
|Government Expenditure/ GDP|-0.0344<br>**|-0.0347<br>**|-0.0328<br>**|-0.0318<br>**|-0.0326<br>**|-0.0309<br>**|
|( in Logs)|-9.6700|-8.6947|-9.4830|-8.1731|-4.9557|-5.1438|
|Human Capital Investment<br>|0.0540<br>**|0.0443<br>**|0.0403<br>**|0.0375<br>**|0.0210<br>**|0.0225<br>**|
|(secondary enrollment, in logs)|9.6987|9.0971|7.0098|7.5080|3.5883|3.9700|
|Governance|0.0178<br>**|0.0158<br>**|0.0225<br>**|0.0156<br>**|0.0112<br>**|0.0120<br>**|
|(from ICRG, 0-6)|7.6480|7.2821|9.2323|6.8609|4.3630|7.9926|
|Trade openness<br>|0.0136<br>**|0.0051|0.0167<br>**|0.0066<br>*|0.0228<br>**|0.0164<br>**|
|(trade volume / GDP, in logs)|3.3448|1.2660|4.2579|1.8845|4.7746|4.3408|
|Manifestation of Violence|||||||
|Probability of Riots||-0.0159<br>**<br>-2.2281||-0.0114<br>-1.6020||-0.0215<br>**<br>-2.9758|
|Probability of Coups||0.0012<br>0.0511||-0.0063<br>-0.2650||-0.0103<br>-0.4569|
|Probability of Civil War||-0.3258<br>**<br>-10.4507||-0.3896<br>**<br>-12.0612||-0.2404<br>**<br>-3.5531|
|Aggregate Probability of Violence|-0.0163<br>*||-0.0180<br>**||-0.0253 **||
||-1.8769||-2.0478||-3.7641||
|Fractionalization<br>Ethnic|||0.0027|-0.0010|-0.0232 **|-0.0154<br>**|
||||0.3212|-0.1578|-2.4243|-2.0120|
|Democracy<br>Partial Democracy Factional|||||-0.0139<br>-0.6393|-0.0042<br>-0.2311|
|Partial Democracy Non-Factional|||||0.0170<br>1.3922|0.0183<br>**<br>2.7124|
|Interactions|||||||
|Ethnic Fractionalization*Partial Democracy Factional|||||0.0971 **<br>1.9276|0.0664<br>1.5372|
|Ethnic Fractionalization*Partial Democracy Non-factional|||||0.0469 **<br>2.0902|0.0337<br>**<br>2.6726|
|Period Shifts (base period: 1975-79):<br>|-0.11926 **<br>**|0.02963<br>**|-0.06994 **<br>**|0.04755<br>**|-0.059938 *<br>**|-0.001441<br>**|
|1980-84<br>1985-89|-0.0179 <br>-0.0202 **|-0.0171 <br>-0.0177 **|-0.0149 <br>-0.0151 **|-0.015495 <br>-0.01609 **|-0.018769 <br>-0.017971 **|-0.018419 <br>-0.019628 **|
|1990-94|-00256**|-00212**|-00207**|-0019657**|-0024363**|-0025479**|
|1995-99|. <br>-0.0336 **|. <br>-0.0292 **|. <br>-0.0294 **|. <br>-0.026536 **|. <br>-0.034894 **|. <br>-0.034139 **|
|No. Countries / No. Observations|68/283|68/283|68/283|68/283|68/283|68/283|
|SPECIFICATION TESTS (P-Values)|||||||
|(a) Sargan Test|0.1520|0.1760|0.2780|0.1590|0.4320|0.453|
|<br>(b) Serial Correlation :<br>Second-Order<br>|0.7140<br>|0.6900<br>|0.7320<br>|0.6640|0.7560|0.972|

Numbers below coefficients are the corresponding robust t-statistics. * (**) denotes statistical significance at the 10 (5) Source: Authors' calculations 31