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Corruption, Structural Reforms, and Economic Performance in the Transition Economies

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  • George T. Abed
  • Hamid Reza Davoodi
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    Abstract

    Recent studies have highlighted the adverse impact of corruption on economic performance. This paper advances the hypothesis that corruption is largely a symptom of underlying weaknesses in public policies and institutions, a formulation that provides deeper insights into economic performance than do measures of “perceived corruption.” The hypothesis is tested by assessing the relative importance of structural reforms vs. corruption in explaining macroeconomic performance in the transition economies. The paper finds that for four widely used measures of economic performance—growth, inflation, the fiscal balance, and foreign direct investment—structural reforms tend to dominate the corruption variable.

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    Bibliographic Info

    Paper provided by International Monetary Fund in its series IMF Working Papers with number 00/132.

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    Length: 47
    Date of creation: 01 Jul 2000
    Date of revision:
    Handle: RePEc:imf:imfwpa:00/132

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    Related research

    Keywords: Transition economies; Structural adjustment; inflation; exchange rate regime; macroeconomic performance; wage inflation; inflation rate; lower inflation; price liberalization; transition countries; political economy; competition policy; foreign exchange; inflation rates; macroeconomic stability; per capita growth rate; aggregate demand; per capita income; liberal trade; competition policies; price mechanism; transition economy; rates of inflation; external trade; endogenous growth; price support; trade restrictions; variable inflation; annual inflation; domestic producers; inflation tax;

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    Cited by:
    1. Campos, Nauro F & Kinoshita, Yuko, 2008. "Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6690, C.E.P.R. Discussion Papers.
    2. Anis Omri & Amel Sassi-Tmar, 2014. "Linking FDI inflows to economic growth in North African countries," Working Papers, Department of Research, Ipag Business School 2014-558, Department of Research, Ipag Business School.
    3. Teodorescu, Daniel & Andrei, Tudorel & Rosca, Ion Gh. & Profiroiu, Marius & Turtureanu, Mihai, 2007. "Local Governance and Corruption of a Country in the Process of Joining the European Union," Journal for Economic Forecasting, Institute for Economic Forecasting, Institute for Economic Forecasting, vol. 4(4), pages 49-60, December.
    4. Ricardo Montero & Gustavo Yamada, 2012. "Exclusión y discriminación étnica en los servicios públicos en el Perú," Chapters of Books, Departamento de Economía, Universidad del Pacífico, in: Francisco Galarza (ed.), Discriminación en el Perú: Exploraciones en el Estado, la empresa y el mercado laboral, edition 1, volume 1, chapter 1, pages 219-278 Departamento de Economía, Universidad del Pacífico.
    5. Peyton, Kyle & Belasen, Ariel, 2010. "The case for human development: a cross-country analysis of corruption perceptions," MPRA Paper 31385, University Library of Munich, Germany.
    6. Ralph Chami & Connel Fullenkamp, 2002. "Trust As a Means of Improving Corporate Governance and Efficiency," IMF Working Papers 02/33, International Monetary Fund.
    7. Tudorel ANDREI & Ani MATEI & Ion Gh. ROSCA, 2009. "The Corruption - An Economic and Social Analysis," Economics Books, The Economica Publishing House, The Economica Publishing House, edition 1, volume 1, number 03, July-Dece.
    8. Börner, Kira Astrid, 2005. "Political Institutions and Incentives for Economic Reforms," Munich Dissertations in Economics, University of Munich, Department of Economics 3165, University of Munich, Department of Economics.
    9. Tudorel Andrei & Ani Matei & Stelian Stancu & Bogdan Oancea, 2009. "Some notes about decentralization process implications on public administration corruption in romania," Prague Economic Papers, University of Economics, Prague, University of Economics, Prague, vol. 2009(1), pages 26-37.
    10. Zaman, Asad & Rahim, Faizur, 2008. "Corruption: Measuring the Unmeasurable," MPRA Paper 13882, University Library of Munich, Germany.
    11. Shah, Anwar, 2006. "Corruption and decentralized public governance," Policy Research Working Paper Series 3824, The World Bank.

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