ABSTRACT
A number of theoretical models provide many compelling reasons why effective state—business relations (SBRs) would stimulate economic growth and poverty reduction. Economic growth has been an important topic of discussion in almost every economy for a very long time. Previous research has found steady increases in investment and productivity to be crucial to a country’s long-run economic growth and poverty reduction. Experiences from East and Southeast Asian economies have also shown that investment and productivity growth critically hinge on an effective and vibrant private sector underpinned by a sound investment climate. Promoting a sound investment climate is one of the core responsibilities of the state in both developed and developing countries to achieve rapid capital accumulation and sustained growth and poverty reduction.
