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Corruption as a form of extreme individualism: An economic explanation based on geography and climate conditions

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Abstract

We present a simple model explaining corruption on geography and climate conditions. We test the model's validity in a cross-section of 115 countries. Controlling for all other corruption's determinants we find evidence supporting the model's predictions. Corruption increases with temperature and declines with precipitation and non-cultivatable land. Corruption also declines with per capita GDP, democracy, median age and British colonial heritage,and increases with natural resources, bureaucracy and communist past. Finally, corruption declines with the ratio of internet users to total population. This new finding is interpreted as capturing the beneficial interaction of economic development, human capital/education and independent news.

Suggested Citation

  • Arghyrou, Michael G, 2010. "Corruption as a form of extreme individualism: An economic explanation based on geography and climate conditions," Cardiff Economics Working Papers E2010/8, Cardiff University, Cardiff Business School, Economics Section.
  • Handle: RePEc:cdf:wpaper:2010/8
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    Cited by:

    1. Carolina Achury & Christos Koulovatianos & John Tsoukalas, "undated". "External Sovereign Debt in a Monetary Union: Bailouts and the Role of Corruption," Discussion Papers 11/11, University of Nottingham, Centre for Finance, Credit and Macroeconomics (CFCM).

    More about this item

    Keywords

    individualism; fairness; corruption; geography and climate conditions;

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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