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Do Democracies Breed Rent-seeking Behavior?

Author

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  • Cesar Calderon
  • Alberto Chong

Abstract

Using objective institutional historical data for the case of Uruguay, we test the link between rent-seeking behavior in democracies using time-series and panel data approaches. We find three main results. First, democratic regimes are negatively linked with rent-seeking actions. Second, the longer the duration of democracy, the less rent seeking in a society. Third, legislation enacted more transparently is negatively correlated with rent-seeking behavior. Our results are robust to the use of different econometric methods and basic robustness tests and are consistent with prevailing theory.

Suggested Citation

  • Cesar Calderon & Alberto Chong, 2006. "Do Democracies Breed Rent-seeking Behavior?," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 9(4), pages 247-260.
  • Handle: RePEc:taf:jpolrf:v:9:y:2006:i:4:p:247-260
    DOI: 10.1080/13841280601079209
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Helene Ehrhart, 2012. "Assessing the relationship between democracy and domestic taxes in developing countries," Economics Bulletin, AccessEcon, vol. 32(1), pages 551-566.
    2. César Calderón & Alberto Chong, 2006. "Rent Seeking and Democracy in Latin America: What Drives What?," Research Department Publications 4435, Inter-American Development Bank, Research Department.
    3. César Calderón & Alberto Chong, 2006. "Búsqueda de rentas y democracia en América Latina: ¿Qué impulsa a qué?," Research Department Publications 4436, Inter-American Development Bank, Research Department.
    4. Rajeev K. Goel, 2012. "Business regulation and taxation: effects on cross-country corruption," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 15(3), pages 223-242, September.
    5. Marco Pani, 2009. "Hold Your Nose and Vote; Why Do Some Democracies Tolerate Corruption?," IMF Working Papers 09/83, International Monetary Fund.
    6. Marco Pani, 2011. "Hold your nose and vote: corruption and public decisions in a representative democracy," Public Choice, Springer, vol. 148(1), pages 163-196, July.
    7. repec:hhs:bofitp:2008_010 is not listed on IDEAS

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