Final answer:
The assertion that modernization theory has established a clear causal link between economic growth and democracy is false; the relationship is complex and not conclusively determined.
Step-by-step explanation:
The statement, "Modernization theory has clearly established a causal link between economic growth and democratic institutions,” is false. Modernization theory suggests that economic growth may lead to democratic institutions, but this remains a complex and debated issue with no clear causal relationship.
Scholars argue that while there is some correlation between economic development and democracy, the presence of one does not necessarily lead to the other due to various political, cultural, and social factors that also play significant roles.