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Corruption clubs: endogenous thresholds in corruption and development

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  • M. Haque

    ()

  • Richard Kneller

    ()

Abstract

The relationship between corruption and economic development is characterised by three stylised facts: (i) a strong negative correlation between corruption and development (ii) countries can remain trapped in high corruption-low development or low corruption-high development equilibria (iii) amongst intermediate levels of development corruption levels are more variable, some countries have high corruption and others low corruption. This paper argues that existing models are consistent with the first two only and demonstrates how these models might be extended to capture all three. The paper searches for the location of corruption clubs within the data and provides some explanation of their cause.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Article provided by Springer in its journal Economics of Governance.

Volume (Year): 10 (2009)
Issue (Month): 4 (November)
Pages: 345-373

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Handle: RePEc:spr:ecogov:v:10:y:2009:i:4:p:345-373

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Related research

Keywords: Corruption; Public spending; Thresholds; Development; D73; H26; O11;

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References

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  1. Papageorgiou, Chris, 2002. "Trade as a threshold variable for multiple regimes," Economics Letters, Elsevier, vol. 77(1), pages 85-91, September.
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Cited by:
  1. Dzhumashev, Ratbek, 2014. "Corruption and growth: The role of governance, public spending, and economic development," Economic Modelling, Elsevier, vol. 37(C), pages 202-215.
  2. Atsushi Kato & Takahiro Sato, 2014. "The effect of corruption on the manufacturing sector in India," Economics of Governance, Springer, vol. 15(2), pages 155-178, May.

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