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Corrupt Clubs and the Convergence Hypothesis

  • Naved Ahmad

    (Institute of Business Administration (IBA), Karachi, Pakistan.)

Empirical work in a cross-section framework demonstrates little or no support for absolute convergence in per capita GDP. I argue in this paper that “divergence in corruption”, defined as the tendency of corrupt countries to become more corrupt faster than less corrupt nations, is a neglected factor that also determines the speed of convergence. Using Transparency International (TI) corruption perceptions index, I estimate C-σ and C-γ coefficients for corrupt and less corrupt economies to explore the C-divergence in corruption rankings. The study concludes that corrupt countries are C-converging, forming a “corrupt club”.

(This abstract was borrowed from another version of this item.)

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File URL: http://www.pide.org.pk/pdf/PDR/2006/Volume4/1001-1009.pdf
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Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

Volume (Year): 45 (2006)
Issue (Month): 4 ()
Pages: 1001-1009

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Handle: RePEc:pid:journl:v:45:y:2006:i:4:p:1001-1009
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  1. M. Alam, 1992. "Convergence in developed countries: an empirical investigation," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 128(2), pages 189-201, June.
  2. Abramovitz, Moses, 1986. "Catching Up, Forging Ahead, and Falling Behind," The Journal of Economic History, Cambridge University Press, vol. 46(02), pages 385-406, June.
  3. Friedman, Milton, 1992. "Do Old Fallacies Ever Die?," Journal of Economic Literature, American Economic Association, vol. 30(4), pages 2129-32, December.
  4. Gerry Boyle; & Tom McCarthy, 1997. "Simple Measures of Convergence in Per Capita GDP: A Note on Some Further International Evidence," Economics, Finance and Accounting Department Working Paper Series n751197, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
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