Regulatory efficiency and economic growth: evidence from East Asia and Latin America

Valdiglesias J.; Quintana D. · Frontiers in Political Science (2026) · DOI: 10.3389/fpos.2026.1736332

Resumen

Introduction: This study reassesses the relationship between regulatory efficiency and economic performance across Latin America and East Asia, aiming to determine whether differences in business entry regulations—measured by the number of days required to start a business—help explain the persistent growth divergence between the two regions. Methods: We employ panel data regressions on a harmonized panel dataset, controlling for trade openness, inflation, investment, and institutional quality. Results: The results show that longer start-up times exert a strong and statistically significant negative effect on economic growth: each additional day required to formally register a business reduces GDP per capita growth. This effect remains stable and robust to controls. Discussion/Conclusion: East Asian economies—particularly China, Japan, Korea, Singapore, and Hong Kong SAR—benefit from predictable and streamlined regulatory environments that support entrepreneurship, investment, and firm expansion. In contrast, Latin American countries continue to face fragmented enforcement and bureaucratic bottlenecks that constrain growth. Overall, regulatory divergence remains a central mechanism behind the widening economic gap between these regions. Copyright

Instituciones: Universidad Nacional Mayor de San Marcos