Can corruption favour growth via the composition of government spending?
AbstractIn an endogenous growth model with two public goods, we analytically derive the optimal composition of government spending in the presence of corruption. Although corruption results in a loss of productivity per se, an increase in corruption in the category of public spending that is harmed relatively more by corruption could have a favourable effect on growth, as it would encourage a benevolent government to divert spending towards the public good that is more productive, net of corruption.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 30 (2010)
Issue (Month): 3 ()
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Corruption; optimal composition of government spending; endogenous growth.;
Find related papers by JEL classification:
- E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
- H5 - Public Economics - - National Government Expenditures and Related Policies
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pierre-Guillaume Méon & Khalid Sekkat, 2005.
"Does corruption grease or sand the wheels of growth?,"
ULB Institutional Repository
2013/7364, ULB -- Universite Libre de Bruxelles.
- Pierre-Guillaume Méon & Khalid Sekkat, 2005. "Does corruption grease or sand the wheels of growth?," Public Choice, Springer, vol. 122(1), pages 69-97, January.
- El Anshasy, Amany A. & Katsaiti, Marina-Selini, 2013. "Natural resources and fiscal performance: Does good governance matter?," Journal of Macroeconomics, Elsevier, vol. 37(C), pages 285-298.
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