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Corruption in America

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  • Edward L. Glaeser
  • Raven Saks

Abstract

We use a data set of federal corruption convictions in the U.S. to investigate the causes and consequences of corruption. More educated states, and to a less degree richer states, have less corruption. This relationship holds even when we use historical factors like education in 1928 or Congregationalism in 1890, as instruments for the level of schooling today. The level of corruption is weakly correlated with the level of income inequality and racial fractionalization, and uncorrelated with the size of government. There is a weak negative relationship between corruption and employment and income growth. These results echo the cross-country findings, and support the view that the correlation between development and good political outcomes occurs because more education improves political institutions.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10821.

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Date of creation: Oct 2004
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Handle: RePEc:nbr:nberwo:10821

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  1. Jakob Svensson, 2003. "Who Must Pay Bribes And How Much? Evidence From A Cross Section Of Firms," The Quarterly Journal of Economics, MIT Press, vol. 118(1), pages 207-230, February.
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  3. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert Vishny, 1998. "The Quality of Goverment," NBER Working Papers 6727, National Bureau of Economic Research, Inc.
  4. Rose-Ackerman, Susan, 1975. "The economics of corruption," Journal of Public Economics, Elsevier, vol. 4(2), pages 187-203, February.
  5. Goldin, Claudia, 1998. "America's Graduation from High School: The Evolution and Spread of Secondary Schooling in the Twentieth Century," Scholarly Articles 2664307, Harvard University Department of Economics.
  6. John McMillan & Pablo Zoido, 2004. "How to Subvert Democracy: Montesinos in Peru," Discussion Papers 03-030, Stanford Institute for Economic Policy Research.
  7. Alberto Alesina & Reza Baqir & William Easterly, 1998. "Redistributive Public Employment," NBER Working Papers 6746, National Bureau of Economic Research, Inc.
  8. Edward L. Glaeser & Andrei Shleifer, 2001. "The Rise of the Regulatory State," NBER Working Papers 8650, National Bureau of Economic Research, Inc.
  9. Edward L. Glaeser & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2004. "Do Institutions Cause Growth?," Journal of Economic Growth, Springer, vol. 9(3), pages 271-303, 09.
  10. Goel, Rajeev K & Nelson, Michael A, 1998. " Corruption and Government Size: A Disaggregated Analysis," Public Choice, Springer, vol. 97(1-2), pages 107-20, October.
  11. Isaac Ehrlich & Francis T. Lui, 1999. "Bureaucratic Corruption and Endogenous Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S270-S293, December.
  12. Rappaport, Jordan & Sachs, Jeffrey D, 2003. " The United States as a Coastal Nation," Journal of Economic Growth, Springer, vol. 8(1), pages 5-46, March.
  13. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  14. Fisman, Raymond & Gatti, Roberta, 2002. " Decentralization and Corruption: Evidence from U.S. Federal Transfer Programs," Public Choice, Springer, vol. 113(1-2), pages 25-35, October.
  15. Daniel Berkowitz & Karen Clay, . "Initial Conditions, Institutional Dynamics and Economic Performance: Evidence from the American States," American Law & Economics Association Annual Meetings 1083, American Law & Economics Association.
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Cited by:
  1. James E. Alt & David D. Lassen, 2008. "Political And Judicial Checks On Corruption: Evidence From American State Governments," Economics and Politics, Wiley Blackwell, vol. 20(1), pages 33-61, 03.
  2. Benjamin A. Olken, 2006. "Corruption Perceptions vs. Corruption Reality," NBER Working Papers 12428, National Bureau of Economic Research, Inc.
  3. Oguzhan C. Dincer & Peter J. Lambert, 2012. "Taking care of your own: ethnic and religious heterogeneity and income inequality," Journal of Economic Studies, Emerald Group Publishing, vol. 39(3), pages 290-313, December.
  4. Russell Sobel & Nabamita Dutta & Sanjukta Roy, 2010. "Does cultural diversity increase the rate of entrepreneurship?," The Review of Austrian Economics, Springer, vol. 23(3), pages 269-286, September.
  5. Marcel Thum, 2005. "Korruption und Schattenwirtschaft," Ifo Working Paper Series Ifo Working Papers No.12, Ifo Institute for Economic Research at the University of Munich.
  6. Olken, Benjamin A., 2006. "Corruption and the costs of redistribution: Micro evidence from Indonesia," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 853-870, May.
  7. R. Alison Felix & James R. Hines, Jr., 2011. "Who Offers Tax-Based Business Development Incentives?," NBER Working Papers 17466, National Bureau of Economic Research, Inc.
  8. Dincer, Oguzhan C., 2008. "Ethnic and religious diversity and corruption," Economics Letters, Elsevier, vol. 99(1), pages 98-102, April.

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