IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v40y2008i14p1839-1849.html
   My bibliography  Save this article

The welfare costs of corruption

Author

Listed:
  • Heinz Welsch

Abstract

Corruption has been shown to affect a variety of economic indicators, especially GDP per capita. However, as GDP is not a genuine indicator of welfare, it may reflect the welfare costs of corruption only in an incomplete way. This article uses self-rated subjective well-being as an empirical approximation to general welfare and shows that cross-national welfare - operationalized in this way - is affected by corruption not only indirectly through GDP, but also directly through nonmaterial factors. This article estimates the size of these effects as well as their monetary equivalent. The direct effect - not previously investigated in the corruption literature - is found to be substantially larger than the indirect effect.

Suggested Citation

  • Heinz Welsch, 2008. "The welfare costs of corruption," Applied Economics, Taylor & Francis Journals, vol. 40(14), pages 1839-1849.
  • Handle: RePEc:taf:applec:v:40:y:2008:i:14:p:1839-1849
    DOI: 10.1080/00036840600905225
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/00036840600905225
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Bruno S. Frey & Simon Luechinger & Alois Stutzer, "undated". "Valuing Public Goods: The Life Satisfaction Approach," IEW - Working Papers 184, Institute for Empirical Research in Economics - University of Zurich.
    2. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Heinz Welsch & Philipp Biermann, 2014. "Energy Prices, Energy Poverty, and Well-Being: Evidence for European Countries," Working Papers V-369-14, University of Oldenburg, Department of Economics, revised Sep 2014.
    2. Andrés Rodríguez-Pose & Kristina Maslauskaite, 2011. "Can policy make us happier? Individual characteristics, socio-economic factors and life satisfaction in Central and Eastern Europe," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 5(1), pages 77-96.
    3. Paul Dolan & Daniel Fujiwara & Robert Metcalfe, 2011. "A Step towards Valuing Utility the Marginal and Cardinal Way," CEP Discussion Papers dp1062, Centre for Economic Performance, LSE.
    4. Andrey V. Aistov & Elvina Mukhametova, 2015. "Determinants Of Corruption Perceptions: Transitional Vs. Developed Economies," HSE Working papers WP BRP 89/EC/2015, National Research University Higher School of Economics.
    5. Friedel Bolle & Claudia Vogel, 2011. "Power comes with responsibility—or does it?," Public Choice, Springer, vol. 148(3), pages 459-470, September.
    6. Nikolova, Milena, 2016. "Minding the happiness gap: Political institutions and perceived quality of life in transition," European Journal of Political Economy, Elsevier, vol. 45(S), pages 129-148.
    7. Rehdanz, Katrin & Welsch, Heinz & Narita, Daiju & Okubo, Toshihiro, 2015. "Well-being effects of a major natural disaster: The case of Fukushima," Journal of Economic Behavior & Organization, Elsevier, vol. 116(C), pages 500-517.
    8. Welsch, Heinz & Biermann, Philipp, 2014. "Electricity supply preferences in Europe: Evidence from subjective well-being data," Resource and Energy Economics, Elsevier, vol. 38(C), pages 38-60.
    9. Rehdanz, Katrin & Welsch, Heinz & Narita, Daiju & Okubo, Toshihiro, 2013. "Well-being effects of a major negative externality: The case of Fukushima," Kiel Working Papers 1855, Kiel Institute for the World Economy (IfW).
    10. Dumbraveanu Andrada, 2015. "On The Trails Of The Gender “Life Satisfaction” Gap: A Mixed Level Analysis," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 257-263, April.
    11. Carmelo León & Jorge Araña & Javier León, 2013. "Correcting for Scale Perception Bias in Measuring Corruption: an Application to Chile and Spain," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 114(3), pages 977-995, December.
    12. Christopher L. Ambrey & Christopher M. Fleming & Matthew Manning & Christine Smith, 2016. "On the Confluence of Freedom of the Press, Control of Corruption and Societal Welfare," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(2), pages 859-880, September.
    13. Jose Gustavo Feres & Rubens Cysne, 2016. "Subjective Well-Being And The Welfare Costs Of Corruption: A Panel Data Approach," Anais do XLIII Encontro Nacional de Economia [Proceedings of the 43rd Brazilian Economics Meeting] 134, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
    14. Beja Jr., Edsel L., 2011. "Subjective Well-Being Approach to the Valuation of International Development: Evidence for the Millennium Development Goals," MPRA Paper 27865, University Library of Munich, Germany.
    15. Alexandra Nonnenmacher & Jürgen Friedrichs, 2013. "The Missing Link: Deficits of Country-Level Studies. A Review of 22 Articles Explaining Life Satisfaction," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 110(3), pages 1221-1244, February.
    16. Edsel Beja Jr., 2013. "Subjective Well-Being Approach to the Valuation of International Development: Evidence for the Millennium Development Goals," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 111(1), pages 141-159, March.
    17. Peerayuth Charoensukmongkol & Murad Moqbel, 2014. "Does Investment in ICT Curb or Create More Corruption? A Cross-Country Analysis," Public Organization Review, Springer, vol. 14(1), pages 51-63, March.
    18. Welsch, Heinz, 2009. "Implications of happiness research for environmental economics," Ecological Economics, Elsevier, vol. 68(11), pages 2735-2742, September.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:40:y:2008:i:14:p:1839-1849. 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: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.