Bangladesh has passed quite some time as a
democratic country. During this time it has also tried to
develop its economic institutional quality. However, a
direct relationship between these two parameters is yet
to be established at either theoretical or empirical level.
This current study investigates the influences of
economic institutions on democracy. Using data of 2002-
2014 and econometric methods of cointegration (based
on Engle & Granger, 1987) we found that governance
indicators such as voice accountability, political stability,
corruption, and government effectiveness have
significant impact on democracy. However corruption
has in general a negative effect on democracy.
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