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Corruption and Confidence in Public Institutions: Evidence from a Global Survey

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  • Bianca Clausen
  • Aart Kraay
  • Zsolt Nyiri

Abstract

Well-functioning institutions matter for economic development. In order to operate effectively, public institutions must also inspire confidence in those they serve. We use data from the Gallup World Poll, a unique and very large global household survey, to document a quantitatively large and statistically significant negative correlation between corruption and confidence in public institutions. This suggests an important indirect channel through which corruption can inhibit development: by eroding confidence in public institutions. This correlation is robust to the inclusion of a large set of controls for country and respondent-level characteristics. Moreover we show how it can plausibly be interpreted as reflecting at least in part a causal effect from corruption to confidence. Finally, we provide evidence that individuals with low confidence in institutions exhibit low levels of political participation, show increased tolerance for violent means to achieve political ends, and have a greater desire to “vote with their feet” through emigration. Copyright , Oxford University Press.

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Bibliographic Info

Article provided by World Bank Group in its journal The World Bank Economic Review.

Volume (Year): 25 (2011)
Issue (Month): 2 ()
Pages: 212-249

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Handle: RePEc:oup:wbecrv:v:25:y:2011:i:2:p:212-249

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Corruption and Confidence in Public Institutions
    by Ariel Goldring in Free Market Mojo on 2010-01-17 08:16:39
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Cited by:
  1. Kearney, Colm, 2012. "Emerging markets research: Trends, issues and future directions," Emerging Markets Review, Elsevier, vol. 13(2), pages 159-183.
  2. Chong, Alberto & De La O, Ana & Karlan, Dean S. & Wantchékon, Léonard, 2012. "Looking Beyond the Incumbent: The Effects of Exposing Corruption on Electoral Outcomes," CEPR Discussion Papers 8790, C.E.P.R. Discussion Papers.
  3. Lopez Claros, Augusto, 2013. "Removing impediments to sustainable economic development : the case of corruption," Policy Research Working Paper Series 6704, The World Bank.
  4. Ugur, Mehmet & Dasgupta, Nandini, 2011. "Corruption and economic growth: A meta-analysis of the evidence on low-income countries and beyond," MPRA Paper 31226, University Library of Munich, Germany, revised 31 May 2011.
  5. Gaoussou DIARRA & Sébastien MARCHAND, 2011. "Does Pervasive Corruption Matter For Firm's Demand for Good Governance in Developing Countries?," Working Papers 201112, CERDI.
  6. Van-Ha Le & Jakob de Haan & Erik Dietzenbacher, 2013. "Do Higher Government Wages Reduce Corruption? Evidence Based on a Novel Dataset," CESifo Working Paper Series 4254, CESifo Group Munich.
  7. Asli Demirguc-Kunt & Leora Klapper, 2013. "Measuring Financial Inclusion: Explaining Variation in Use of Financial Services across and within Countries," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 46(1 (Spring), pages 279-340.

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