The challenge in this box is to lay out both lines of reasoning (growth theory and institutions) and illustrate the poin

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The challenge in this box is to lay out both lines of reasoning
(growth theory and institutions) and illustrate the point using the
resources below.
In this box talk about the income gap between the countries in
general [25 points]. Explain through the lens of the theory and
institutions why this is the case [25 points]. Discuss whether
there is evidence of convergence/divergence in income terms [25
points] and institutional quality [25 points] among your selection
of countries.
When talking about the theory be sure touch
on the set up of the model, interpretation, and its predictions. A
good reference to get a sense of the role
of institutions in economic performance read
Hali Edison, “How strong are the links between institutional
quality and economic performance?”, Finance and Development,
June 2003, Vol. 40, Num. 2, International Monetary Fund. There is a
large literature on the topic, but this a good introduction. In the
box do not focus on the existing literature, but rather on the
complementarity between
the theory and institutions to
explain the issue for a reader that does not much about either.
This type of exercise is useful for, say, a firm looking to expand
into foreign markets.