Corruption and International Trade: A Comprehensive Analysis with Gravity
The aim of this paper is to analyze the impact of corruption on trade. To this end, we estimate gravity equations using a wide sample of countries for a long period of time and three different measures of corruption: Corruption Perception Index (CPI), Control of Corruption Index (CCI) and a Structural Corruption Index (SCI). Our results show that perception-based indexes (CPI and CCI) give quite different results with respect to the Structural index (SCI) and that the detected impacts are somewhat sensitive to the formation of regional trade agreements or the level of per-capita income of the trade partners. In particular, when using the CCI index and there is at least one middle or low income country in the pair a positive effect of corruption on trade appears. Moreover, the negative impact of differences in the level of corruption detected with the SCI index appears to be much more relevant when the two countries are high income.
|Date of creation:||May 2017|
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