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Inequality, corruption and the informal sector

  • Dobson, Stephen
  • Ramlogan-Dobson, Carlyn

The marginal impact of corruption on income inequality is shown to be a linear function of the size of the informal sector. This implies that anti-corruption policies alone are unlikely to reduce inequality in countries with a large informal sector.

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Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 115 (2012)
Issue (Month): 1 ()
Pages: 104-107

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Handle: RePEc:eee:ecolet:v:115:y:2012:i:1:p:104-107
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  1. Axel Dreher & Christos Kotsogiannis & Steve McCorriston, 2009. "How do institutions affect corruption and the shadow economy?," International Tax and Public Finance, Springer, vol. 16(6), pages 773-796, December.
  2. Ulyssea, Gabriel, 2010. "Regulation of entry, labor market institutions and the informal sector," Journal of Development Economics, Elsevier, vol. 91(1), pages 87-99, January.
  3. Choi, Jay Pil & Thum, Marcel, 2003. "Corruption and the shadow economy," Dresden Discussion Paper Series in Economics 02/03, Dresden University of Technology, Faculty of Business and Economics, Department of Economics.
  4. Stefania Albanesi, 2002. "Inflation and Inequality," Macroeconomics 0201002, EconWPA.
  5. World Bank, 2010. "World Development Indicators 2010," World Bank Publications, The World Bank, number 4373.
  6. Sanjeev Gupta & Hamid Davoodi & Rosa Alonso-Terme, 2002. "Does corruption affect income inequality and poverty?," Economics of Governance, Springer, vol. 3(1), pages 23-45, 03.
  7. Schneider, Friedrich G., 2007. "Shadow Economies and Corruption All Over the World: New Estimates for 145 Countries," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 1, pages 1-66.
  8. Carlyn Dobson & Antonio Rodríguez, 2010. "Is Corruption Really Bad for Inequality? Evidence from Latin America," Development Research Working Paper Series 02/2010, Institute for Advanced Development Studies.
  9. Kwabena Gyimah-Brempong & Samaria de Gyimah-Brempong, 2006. "Corruption, Growth, and Income Distribution: Are there Regional Differences?," Economics of Governance, Springer, vol. 7(3), pages 245-269, August.
  10. Stephen Dobson & Carlyn Ramlogan, 2009. "Is there a trade-off between income inequality and corruption? Evidence from Latin America," Working Papers 2009/4, Nottingham Trent University, Nottingham Business School, Economics Division.
  11. Schneider, Friedrich G. & Buehn, Andreas, 2007. "Shadow economies and corruption all over the world: revised estimates for 120 countries," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 1, pages 1-53.
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