The Impact of Governanceon Economic Growth in Yemen: An Empirical Study
This study is trying to answer the question, to what extent governance dimensions affect economic growth represented by GDP for the period from 1996 to 2013 to see which indicator of governance has more impact on growth. The results shows governance indicators with economic growth confirm the existence of correlation and effect between the variables of the study, which is consistent with previous literature. So, main null hypotheses rejected. The researcher also discussed points of view for a number of researchers in a number of previous literatures about governance effects on growth. Based on theoretical analysis, review of governance indicators to see whether governance affects economic growth or not. The study confirms governance is an important concept for any country, particularly developing ones. Although, the two variables rule of law and political instability has real impact but we cannot neglect the rest of variables and this is what confirmed in backward and stepwise analysis where they also confirmed the existence of the effects of governance indicators on growth. According to the whole analysis methods rule of law and political instability index repeated as the most important indicators play a pivotal role in determination of the growth on economic of Yemen.
Key words- Governance, Economic Growth, Yemen, Governance Worldwide Indicators