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Corruption and Income Inequality in Asian Countries: Bootstrap Panel Granger Causality Test

Author

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  • Chiung-Ju Huang

    (Department of Public Finance, Feng Chia University, Taiwan)

Abstract

The purpose of this study is to investigate the causal relationship between corruption and income inequality experienced in ten Asian economies over the period 1995 to 2010. This study utilizes the bootstrap panel Granger causality approach, which allows both cross-sectional dependence and heterogeneity across countries, and is based on seemingly unrelated regressions (SUR) systems and Wald tests with country-specific bootstrap critical values. The empirical results show that there is a unidirectional causality from corruption to income inequality in China and the Philippines. Meanwhile, a one-way causal relationship running from income inequality to corruption exists in Indonesia, Japan, Korea, and Thailand.

Suggested Citation

  • Chiung-Ju Huang, 2013. "Corruption and Income Inequality in Asian Countries: Bootstrap Panel Granger Causality Test," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 161-170, December.
    • Handle: RePEc:rjr:romjef:v::y:2013:i:4:p:161-170
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    References listed on IDEAS

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    Cited by:

    1. Sher Khan, 2022. "Investigating the Effect of Income Inequality on Corruption: New Evidence from 23 Emerging Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 2100-2126, September.
    2. Sulemana, Iddisah & Kpienbaareh, Daniel, 2018. "An empirical examination of the relationship between income inequality and corruption in Africa," Economic Analysis and Policy, Elsevier, vol. 60(C), pages 27-42.
    3. Alvarado, Rafael & Tillaguango, Brayan & López-Sánchez, Michelle & Ponce, Pablo & Işık, Cem, 2021. "Heterogeneous impact of natural resources on income inequality: The role of the shadow economy and human capital index," Economic Analysis and Policy, Elsevier, vol. 69(C), pages 690-704.

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    More about this item

    Keywords

    corruption; income inequality; cross-sectional dependence; heterogeneity; panel Granger causality test;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • H80 - Public Economics - - Miscellaneous Issues - - - General

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