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Education, Corruption and Constitutional Reform

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Author Info
Theo Eicher
Cecilia García-Peñalosa
Tanguy van Ypersele

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Abstract

We model the two way interaction between education, corruption and the level of output. Corruption reduces income levels and hence educational attainment. Education in turn affects the incentives for corruption: more education increases output and thus the rents from corruption, but it also increases the probability that the electorate identifies corrupt behavior and ousts the incumbent politician. In this context, we identify the conditions under which an opportunist politician has the incentives to take actions that will allow the economy to escape from a poverty trap. Our analysis shows that the relationship between education, output levels and the level of corruption is non-monotonic, and that both institution-led development and education-led development are possible. Which path occurs crucially depends on the initial level of inequality.

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Paper provided by University of Washington, Department of Economics in its series Working Papers with number UWEC-2007-17-P.

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Date of creation: Oct 2006
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Publication status: Published in Journal of Economic Growth, Volume
Handle: RePEc:udb:wpaper:uwec-2007-17-p

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  1. Bourguignon, Francois & Verdier, Thierry, 2000. "Oligarchy, democracy, inequality and growth," Journal of Development Economics, Elsevier, vol. 62(2), pages 285-313, August. [Downloadable!] (restricted)
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  2. Joan Esteban & Debraj Ray, 2006. "Inequality, Lobbying, and Resource Allocation," American Economic Review, American Economic Association, vol. 96(1), pages 257-279, March. [Downloadable!]
  3. Oded Galor & Omer Moav, 2006. "Das Human-Kapital: A Theory of the Demise of the Class Structure," Review of Economic Studies, Blackwell Publishing, vol. 73(1), pages 85-117, 01. [Downloadable!] (restricted)
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  4. Daron Acemoglu & James A. Robinson, 2000. "Why Did The West Extend The Franchise? Democracy, Inequality, And Growth In Historical Perspective," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1167-1199, November. [Downloadable!] (restricted)
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  5. Daron Acemoglu & Simon Johnson & James A. Robinson & Pierre Yared, 2005. "From Education to Democracy?," American Economic Review, American Economic Association, vol. 95(2), pages 44-49, May. [Downloadable!]
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  6. Ritva Reinikka & Jakob Svensson, 2005. "Fighting Corruption to Improve Schooling: Evidence from a Newspaper Campaign in Uganda," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 259-267, 04/05. [Downloadable!] (restricted)
  7. Philippe Aghion & Alberto Alesina & Francesco Trebbi, 2004. "Endogenous Political Institutions," The Quarterly Journal of Economics, MIT Press, vol. 119(2), pages 565-611, May. [Downloadable!] (restricted)
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  8. Emerson, Patrick M., 2006. "Corruption, competition and democracy," Journal of Development Economics, Elsevier, vol. 81(1), pages 193-212, October. [Downloadable!] (restricted)
  9. Glaeser, Edward L. & Saks, Raven E., 2006. "Corruption in America," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1053-1072, August. [Downloadable!] (restricted)
  10. Oded Galor & Omer Moav & Dietrich Vollrath, 2005. "Land Inequality and the Emergence of Human Capital Promoting Institutions," Development and Comp Systems 0502018, EconWPA. [Downloadable!]
  11. Daron Acemoglu & Simon Johnson & James A. Robinson, 2002. "Reversal Of Fortune: Geography And Institutions In The Making Of The Modern World Income Distribution," The Quarterly Journal of Economics, MIT Press, vol. 117(4), pages 1231-1294, November. [Downloadable!] (restricted)
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