Comment on: “Institutional causes, macroeconomic symptoms: volatility, crises and growth”

Do institutions have a role in explaining cross-country differences in growth performance? This interesting paper not only argues that the answer is yes, but suggests that institutions are the deep factor driving these differences and that macroeconomic policies are only one of the mediating channels through which institutions affect growth and growth volatility. In this paper I show that the variable used by the authors to capture the degree of democracy of current institutions is determined by two components: early institutions and time of independence. Moreover, only this second variable seems to affect volatility of output growth.