1. Institutional approach to economic development. How do institutions affect economic development and through what mechanisms? Note costs and their sources as well as incentives.2. What are...

1. Institutional approach to economic development. How do institutions affect economic development and through what mechanisms? Note costs and their sources as well as incentives.2. What are institutions? Distinguish between formal and informal institutions and how they can co-exist, evolve over time, or morph into each other. Types of institutions. Why and how do bad (good) institutions replace good (bad) institutions? Reasons why the “good” institutions may not develop or be prevented from developing in a country.There are two short answer questions here, but share with one of my lecture ppt, so I put them together. Please answer it related with my notes and for each answer it is better for me if no more than 300 words.