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Relationships between corruption, political orientation, and income inequality: evidence from Latin America

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  • Luis Enrique Pedauga
  • Lucien David Pedauga
  • Blanca L. Delgado-Márquez

Abstract

This research sheds light on the analysis of the impact of corruption and political orientation on income distribution in Latin America. Although it has been theoretically demonstrated that corruption worsens the income distribution, the empirical evidence has yielded ambiguous results based on biased estimates not considering a measurement error in the estimation of inequality. This article fills this gap by correcting the previous measurement error bias in the fixed-effects estimation. Additionally, political orientation and its relationship with income inequality are also investigated. The sample covers 18 Latin American countries between 1996 and 2012. Results reveal that corruption increases income inequality.

Suggested Citation

  • Luis Enrique Pedauga & Lucien David Pedauga & Blanca L. Delgado-Márquez, 2017. "Relationships between corruption, political orientation, and income inequality: evidence from Latin America," Applied Economics, Taylor & Francis Journals, vol. 49(17), pages 1689-1705, April.
    • Handle: RePEc:taf:applec:v:49:y:2017:i:17:p:1689-1705
    DOI: 10.1080/00036846.2016.1223830
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    Cited by:

    1. Lucas Dutra de Paulo & Ricardo Carvalho de Andrade Lima & Robson Tigre, 2022. "Corruption and economic growth in Latin America and the Caribbean," Review of Development Economics, Wiley Blackwell, vol. 26(2), pages 756-773, May.
    2. Sebri, Maamar & Dachraoui, Hajer, 2021. "Natural resources and income inequality: A meta-analytic review," Resources Policy, Elsevier, vol. 74(C).
    3. Bestari Dwi Handayani & Heri Yanto & Amin Pujiati & Abdul Rahim Ridzuan & J. S. Keshminder & Mohd Shahidan Shaari, 2022. "The Implication of Energy Consumption, Corruption, and Foreign Investment for Sustainability of Income Distribution in Indonesia," Sustainability, MDPI, vol. 14(23), pages 1-15, November.

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