The effect of political leaders on economic growth through institutional change

Abstract

The article summarizes the influence of political leaders on institutions which, according to institutional economics, directly influences economic growth. Furthermore, the study reviews the literature in which leadership itself becomes a significant factor as a possible explanation for the reason for economic growth through institutional change. Although political leader or its role in growth is still viewed as a controversial issue in economics, the paper emphasises what kind of cause-effect relations exist between political leaders and economic growth and reveals that leaders do matter directly in economic performance by the formation of institutions