Advanced Search
MyIDEAS: Login to save this paper or follow this series

Explaining the two-way causality between inequality and democratization through corruption and concentration of power

Contents:

Author Info

  • Eren, Ozlem

Abstract

Corruption increases inequality in the society (Gupta et al, 1998) by reducing economic growth, biasing the tax system, reducing the amount and the efficiency of spending on key areas for human capital formation. Mohtadi and Roe (2002) and Mohtadi and Agarwhal (2002) argue that democracy first increases corruption due to the newly introduced freedom and rights, and then as democracy grows corruption decreases. The purpose of this paper is to examine the relationship between inequality and democracy in two directions, both the effect of democracy on inequality and the effect of inequality on democracy. It will help to establish a more direct link than explaining inequality indirectly through corruption. It follows from the existing literature on democratization and inequality that higher level of inequality brings decrease in democratization, since inequality increases the incentives of the elite class to limit the democractic rights of the rest of the population in order to avoid any uprisings. (Acemoglu, 2001) The causality may be thought to run from the other direction, too; that is, from the effect of democracy on inequality: Democracy first increases, then decreases corruption (Mohtadi and Roe, 2002) So, at the beginning, the increased corruption due to democratization would be expected to increase inequality (Gupta et al, 1998).Then at the later stages democracy lowers the inequality since it lowers corruption, rent seeking agents would be high in number and the average rent would decrease.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://mpra.ub.uni-muenchen.de/26415/
File Function: original version
Download Restriction: no

Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 26415.

as in new window
Length:
Date of creation: Dec 2002
Date of revision:
Handle: RePEc:pra:mprapa:26415

Contact details of provider:
Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC

Related research

Keywords: inequality; corruption; democratization; growth; institutions;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Mohtadi, Hamid & Roe, Terry L., 2001. "Democracy, Rent Seeking, Public Spending And Growth," Bulletins 12981, University of Minnesota, Economic Development Center.
  2. Deininger, Klaus & Squire, Lyn, 1998. "New ways of looking at old issues: inequality and growth," Journal of Development Economics, Elsevier, vol. 57(2), pages 259-287.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:26415. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.