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Government size, market-orientation and regional corruption: Evidence from the provincial level panel data

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  • ZHOU Li¡¯an

    (Guanghua School of Management, Peking University, Beijing 100871, China Morris Research Institute for Economic Policy, Peking University, Beijing 100871, China)

  • TAO Jing

    (Center for Economic Research, Peking University, Beijing 100871, China)

Abstract

Using a panel data at the provincial level during the period of 1989–2004, this paper examines the effects of social and economic factors such as government scale, privatization, openness, and education on regional corruption. Applying a fixed-effect model and IV estimation, we find that government size positively affects the incidence rate of corruption, and the effect becomes larger with the increase in the size of the core department of the government. 1% increase in the core department of the government leads to a 0.68%–1% increase in the number of corruption cases. While the proportion of FDI is positively associated with the corruption of regional officials, the ratio of the import and export trade to GDP is negatively associated with corruption. The impact of privatization on corruption is ambiguous. We also identify the significant impacts of the size and structure of the government expenditure on corruption. Keywords corrup

Suggested Citation

  • ZHOU Li¡¯an & TAO Jing, 2009. "Government size, market-orientation and regional corruption: Evidence from the provincial level panel data," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 4(3), pages 425-448, September.
    • Handle: RePEc:fec:journl:v:4:y:2009:i:3:p:425-448
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    File URL: http://journal.hep.com.cn/fec/EN/10.1007/s11459-009-0023-2
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    1. Changqi Wu & Zhicheng Liu, 2012. "A Tiger Without Teeth? Regulation of Administrative Monopoly Under China’s Anti-Monopoly Law," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 41(1), pages 133-155, August.

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    More about this item

    Keywords

    corruption; government size; market-orientation;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration

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