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Corruption and Its Alternatives: A Takeoff Theory of Good Governance

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  • Evan Osborne
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    Abstract

    Corruption is a function of its return relative to engaging in productive activities. This paper presents an approach for thinking about the institutional features of societies and the resulting amount of corruption. The empirical results suggest that political competition is more important than competition in information-producing industries. The rent-seeking view of the relation between government and corruption is rejected in favor of the Becker (1983) model of political competition. The paper suggests that societies that continually stay open to productivity-enhancing activities will eventually enter a takeoff stage of anti-corruption efforts analogous to the eventual improvement in income distribution that occurs in successful industrialization.

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    File URL: http://www.iser.osaka-u.ac.jp/library/dp/2004/DP0604.pdf
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    Bibliographic Info

    Paper provided by Institute of Social and Economic Research, Osaka University in its series ISER Discussion Paper with number 0604.

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    Date of creation: May 2004
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    Handle: RePEc:dpr:wpaper:0604

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    13. Osborne, Evan, 2001. "Culture, Development, and Government: Reservations in India," Economic Development and Cultural Change, University of Chicago Press, vol. 49(3), pages 659-85, April.
    14. Wittman, Donald, 1989. "Why Democracies Produce Efficient Results," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1395-1424, December.
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    16. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
    17. Bharat Kolluri & Michael Panik & Mahmoud Wahab, 2000. "Government expenditure and economic growth: evidence from G7 countries," Applied Economics, Taylor & Francis Journals, vol. 32(8), pages 1059-1068.
    18. Barreto, Raul A., 2000. "Endogenous corruption in a neoclassical growth model," European Economic Review, Elsevier, vol. 44(1), pages 35-60, January.
    19. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1993. "Why Is Rent-Seeking So Costly to Growth?," American Economic Review, American Economic Association, vol. 83(2), pages 409-14, May.
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