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Institutions, Corruption and Sustainable Development

  • Bertrand Venard

    ()

    (Audencia Recherche - Audencia, Wharton Business School - University of Pennsylvania)

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    This paper aims to analyze the relationship between institutional quality, corruption level, and economic development. The methodology makes use of cross-national data developed by the World Bank on perceived levels of corruption, institutional framework quality and economic development to test various hypotheses. The added value of this paper is thus to investigate the impact of both institutional framework quality and corruption on economic development. A significant addition to the literature is made by using genuine wealth growth per capita as a proxy for economic development, rather than GDP growth per capita (Ehrlich, Lui, 1999). One other original contribution is the application of the rarely used PLS (Partial Least Squares) structural equation modelling to evaluate the proposed scheme. The empirical research supports the "sand in the wheel" school of thought in relation to the effects of corruption on economic development.

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    File URL: http://hal-audencia.archives-ouvertes.fr/hal-00874275/document
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    Paper provided by HAL in its series Post-Print with number hal-00874275.

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    Date of creation: 2013
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    Publication status: Published in Economics Bulletin, Economics Bulletin, 2013, 33 (4), pp.2545-2562
    Handle: RePEc:hal:journl:hal-00874275
    Note: View the original document on HAL open archive server: http://hal-audencia.archives-ouvertes.fr/hal-00874275
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