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Do Neoliberal Policies Deter Political Corruption?

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  • Gerring, John
  • Thacker, Strom C.
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    Abstract

    This article probes the relationship between neoliberal economic policies and political corruption, focusing in particular on the impact of trade and investment policies, regulatory policy, and the overall size of the public sector on corruption. Using a large cross-national data set from the mid- to late 1990s, we test the neoliberal hypotheses that market-oriented economic policies are associated with lower levels of political corruption, and state intervention in the economy with higher levels. Consistent with the neoliberal argument, we find that open trade and investment policies and low, effective regulatory burdens do correlate with lower levels of political corruption. However, we find no consistent relationship between the aggregate size of the public sector and political corruption. While the neoliberal hypothesis on political corruption has initial empirical support, its lessons cannot be applied wholesale. Market-oriented states may be less corrupt, but interventionist states, as measured by public spending, are not necessarily more corrupt.Previous versions of this article were presented at the annual meeting of the International Studies Association, New Orleans, La., March 24 27, 2002; the Seminar on U.S. and World Affairs, Hoover Institution, Stanford University, Palo Alto, Calif., January 2003; and the Seminar on Comparative Politics, Department of Political Science, Stanford University, February 2003. The authors thank participants at each of these venues for their valuable comments. Alberto D az-Cayeros, Chappell Lawson, Armando Razo, and three anonymous reviewers provided especially useful suggestions. The usual disclaimers apply. Gerring is grateful for financial support provided by the Institute for Advanced Study, and Thacker for the support provided by the Hoover Institution, Stanford University. Both Gerring and Thacker are thankful for support from the Frederick S. Pardee Center for the Study of the Longer-Range Future, Boston University.

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    Bibliographic Info

    Article provided by Cambridge University Press in its journal International Organization.

    Volume (Year): 59 (2005)
    Issue (Month): 01 (January)
    Pages: 233-254

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    Handle: RePEc:cup:intorg:v:59:y:2005:i:01:p:233-254_05

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    Cited by:
    1. Graf Lambsdorff, Johann, 2005. "Consequences and causes of corruption: What do we know from a cross-section of countries?," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-34-05, University of Passau, Faculty of Business and Economics.
    2. Luca Pieroni & Giorgio D'Agostino, 2011. "Corruption and the effects of economic freedom," Departmental Working Papers of Economics - University 'Roma Tre' 0133, Department of Economics - University Roma Tre.
    3. Bin Dong & Benno Torgler, 2010. "The Causes of Corruption: Evidence from China," CREMA Working Paper Series 2010-07, Center for Research in Economics, Management and the Arts (CREMA).
    4. Eugen Dimant, 2013. "The Nature of Corruption - An Interdisciplinary Perspective," Working Papers CIE 70, University of Paderborn, CIE Center for International Economics.
    5. Jellal, Mohamed, 2014. "Firmes industrielles concurrence et corruption
      [Industrial firms competition and corruption]
      ," MPRA Paper 57284, University Library of Munich, Germany.
    6. Dong, Bin & Torgler, Benno, 2013. "Causes of corruption: Evidence from China," China Economic Review, Elsevier, vol. 26(C), pages 152-169.
    7. Razafindrakoto, Mireille & Roubaud, François, 2010. "Are International Databases on Corruption Reliable? A Comparison of Expert Opinion Surveys and Household Surveys in Sub-Saharan Africa," World Development, Elsevier, vol. 38(8), pages 1057-1069, August.
    8. Judge, William Q. & McNatt, D. Brian & Xu, Weichu, 2011. "The antecedents and effects of national corruption: A meta-analysis," Journal of World Business, Elsevier, vol. 46(1), pages 93-103, January.
    9. Kodila Tedika, Oasis, 2012. "Empirical Survey on the Causes of the Corruption
      [Aperçu empirique sur les causes de la corruption]
      ," MPRA Paper 41484, University Library of Munich, Germany.
    10. Grießhaber, Nicolas & Geys, Benny, 2011. "Civic engagement and corruption in 20 European democracies," Discussion Papers, Research Professorship & Project "The Future of Fiscal Federalism" SP II 2011-103, Social Science Research Center Berlin (WZB).
    11. Gueorguiev, Dimitar & Malesky, Edmund, 2012. "Foreign investment and bribery: A firm-level analysis of corruption in Vietnam," Journal of Asian Economics, Elsevier, vol. 23(2), pages 111-129.
    12. Christian Bjørnskov, 2012. "Can bribes buy protection against international competition?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 148(4), pages 751-775, December.

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