Page 297 - ES 2020-21_Volume-1-2 [28-01-21]

280 Economic Survey 2020-21 Volume 1

Log Population^ 0.231 0.125
(0.314) (0.253)
Log GDP per capita (PPP)^ -0.0982 -0.114
(0.0847) (0.0968)
Observations 936 936 936 936 936
Adjusted R-squared 0.948 0.948 0.948 0.948 0.948
Country FE Yes Yes Yes Yes Yes

Robust standard errors in parentheses
*** p<0.01, ** p<0.05, * p<0.1
^2019 figures

8.53 Table 3 reports panel Fixed Effects (FE) regression results for dependant variable Log
Creative Output rank for five models with different independent variables - Log input pillars,
Log GDP, Log GDP per capita and Log population. Among the input pillars, it shows that Log
Institutions and Log Business Sophistication ranks are significant and positively correlated with
Log Creative Output rank, controlling for other pillars, income and population. Population,
when included, was found significant and positively correlated with Log Creative Output rank,
controlling for other pillars and income. Log GDP and Log GDP per capita, when included
with population, were found significant and negatively correlated with Log Creative Output
rank, controlling for other pillars. This suggests that improvements in institutions and business
sophistication could lead to higher creative output performance. Higher income is also expected
to lead to better performance in creative outputs, and hence ranks closer to one (thereby reflecting
a negative correlation).

Table 3: Panel Regression Results: Fixed Effects

Dependant Variable: Log Creative Output rank

(1) (2) (3) (4) (5)
VARIABLES Model 1 Model 2 Model 3 Model 4 Model 5

Log Institutions rank 0.160** 0.150** 0.130* 0.140** 0.130*
(0.0695) (0.0702) (0.0702) (0.0702) (0.0702)
Log HCR rank 0.0327 0.0308 0.0412 0.0322 0.0414

(0.0602) (0.0600) (0.0590) (0.0595) (0.0590)
Log Infrastructure rank -0.0598 -0.0669 -0.0730 -0.0717 -0.0729
(0.0802) (0.0813) (0.0809) (0.0810) (0.0809)
Log Market Sop rank 0.00327 0.00411 0.0113 0.00618 0.0115
(0.0451) (0.0449) (0.0447) (0.0448) (0.0447)
Log Business Sop rank 0.0766** 0.0736** 0.0634* 0.0697* 0.0631*
(0.0365) (0.0364) (0.0363) (0.0363) (0.0364)

Log GDP (PPP)^ -0.103 -0.267***
(0.0775) (0.0986)