Regulatory Design and Long-Term Growth: Insights from China's Experience for Latin America.

Background: Regulatory efficiency is increasingly recognized as a key determinant of long-term economic growth. China's institutional consolidation offers a comparative reference case for understanding how streamlined procedures, and coordinated governance can reduce transaction costs and foster development. In contrast, many Latin American countries face persistent administrative complexity that may hinder growth. Methods: This study applies Institutional Theory and Transaction Cost Economics. Using panel-data estimations with fixed- and random-effects models, the analysis examines the relationship between regulatory indicators-procedural requirements, compliance costs, and business-environment scores-and GDP per capita growth. Macroeconomic controls such as trade openness, inflation, capital formation, and rule of law are included. China serves as a comparative model against selected Latin American countries. Results: The results show a robust and statistically significant association between lower regulatory frictions and stronger economic performance. China's coherent and strategically aligned regulatory framework is linked to higher and more stable GDP per capita growth. In contrast, Latin America exhibits persistent procedural delays, and higher compliance costs, which correspond to weaker and more volatile growth outcomes. Panel-data and dummy-variable regressions consistently confirm China's superior performance as a reference for effective regulatory design. Conclusions: This study provides quantitative evidence that regulatory design and institutional coordination are decisive for long-term economic growth. By highlighting the growth costs of administrative inefficiency and the benefits of coherent regulation, the findings inform policy strategies aimed at improving institutional quality and fostering sustainable development. Comparative reference, such as China, demonstrate how regulatory performance can enhance productivity and macroeconomic stability in emerging economies.