Corruption and Social Capital
I examine the causal relation between social capital and corruption. A simple model illustrates potential mechanisms and yields testable implications, which I estimate in a sample of European countries. The estimated effect of social capital on corruption is found to be robust to the inclusion of a number of other variables and supplementing the sample with slightly older data from non-European countries. The evidence of the reverse causal direction is weak. I suggest that it is possible to build social capital through investing in education, interest in society and some level of income redistribution, which in turn reduces corruption.
|Date of creation:||07 Jan 2003|
|Date of revision:|
|Contact details of provider:|| Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark|
Phone: +45 89 486396
Fax: +45 8615 5175
Web page: http://www.asb.dk/departments/nat.aspx
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