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Whither Corruption? A Quantitative Survey of the Literature on Corruption and Growth

  • Campos, Nauro F

    ()

    (Brunel University)

  • Dimova, Ralitza

    ()

    (University of Manchester)

  • Saleh, Ahmad

    ()

    (Brunel University)

Does corruption grease or sand the wheels of economic growth? This paper uses meta-analysis techniques to systematically evaluate the evidence addressing this question. It uses a data set comprising 460 estimates of the effect of corruption on growth from 41 empirical studies. The main factors explaining the variation in these estimates are whether the model accounts for institutions and trade openness (both are found to deflate the negative effect of corruption), authors' affiliation (academics systematically report less negative impacts), and use of fixed-effects. We also find that publication bias, albeit somewhat acute, does not eliminate the genuine negative effect of corruption on economic growth.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5334.

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Length: 33 pages
Date of creation: Nov 2010
Date of revision:
Handle: RePEc:iza:izadps:dp5334
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  1. Hristos Doucouliagos & Mehmet Ulubasoglu, 2006. "Democracy and Economic Growth: A Meta-Analysis," Economics Series 2006_04, Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance.
  2. repec:dgr:uvatin:20040134 is not listed on IDEAS
  3. Razafindrakoto, Mireille & Roubaud, François, 2010. "Are international databases on corruption reliable? A comparison of expert opinion surveys and household surveys in sub-Saharan Africa," Economics Papers from University Paris Dauphine 123456789/4352, Paris Dauphine University.
  4. Ravallion, Martin, 2001. "Growth, Inequality and Poverty: Looking Beyond Averages," World Development, Elsevier, vol. 29(11), pages 1803-1815, November.
  5. Chris Doucouliagos, 2005. "Publication Bias in the Economic Freedom and Economic Growth Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 19(3), pages 367-387, 07.
  6. Levy, Daniel, 2007. "Price adjustment under the table: Evidence on efficiency-enhancing corruption," European Journal of Political Economy, Elsevier, vol. 23(2), pages 423-447, June.
  7. Pande, Rohini, 2007. "Understanding Political Corruption in Low Income Countries," Working Paper Series rwp07-020, Harvard University, John F. Kennedy School of Government.
  8. Hristos Doucouliagos & Martin Paldam, 2006. "Aid Effectiveness on Accumulation: A Meta Study," Kyklos, Wiley Blackwell, vol. 59(2), pages 227-254, 05.
  9. T. D. Stanley, 2008. "Meta-Regression Methods for Detecting and Estimating Empirical Effects in the Presence of Publication Selection," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 70(1), pages 103-127, 02.
  10. Aidt, T.S., 2009. "Corruption, Institutions and Economic Development," Cambridge Working Papers in Economics 0918, Faculty of Economics, University of Cambridge.
  11. T. D. Stanley, 2001. "Wheat from Chaff: Meta-analysis as Quantitative Literature Review," Journal of Economic Perspectives, American Economic Association, vol. 15(3), pages 131-150, Summer.
  12. Isaac Ehrlich & Francis T. Lui, 1999. "Bureaucratic Corruption and Endogenous Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S270-S293, December.
  13. Hongyi Li & Lixin Colin Xu & Heng-fu Zou, 2000. "Corruption, Income Distribution, and Growth," Economics and Politics, Wiley Blackwell, vol. 12(2), pages 155-182, 07.
  14. Egger, Peter & Winner, Hannes, 2005. "Evidence on corruption as an incentive for foreign direct investment," European Journal of Political Economy, Elsevier, vol. 21(4), pages 932-952, December.
  15. Pierre-Guillaume Méon & Laurent Weill, . "Is corruption an efficient grease?," ULB Institutional Repository 2013/8408, ULB -- Universite Libre de Bruxelles.
  16. Razafindrakoto, Mireille & Roubaud, François, 2010. "Are International Databases on Corruption Reliable? A Comparison of Expert Opinion Surveys and Household Surveys in Sub-Saharan Africa," World Development, Elsevier, vol. 38(8), pages 1057-1069, August.
  17. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
  18. Fisman, Raymond & Svensson, Jakob, 2007. "Are corruption and taxation really harmful to growth? Firm level evidence," Journal of Development Economics, Elsevier, vol. 83(1), pages 63-75, May.
  19. Simonetta Longhi & Peter Nijkamp & Jacques Poot, 2005. "A Meta-Analytic Assessment of the Effect of Immigration on Wages," Journal of Economic Surveys, Wiley Blackwell, vol. 19(3), pages 451-477, 07.
  20. Babecký, Jan & Campos, Nauro F., 2011. "Does reform work? An econometric survey of the reform-growth puzzle," Journal of Comparative Economics, Elsevier, vol. 39(2), pages 140-158, June.
  21. Ritva Reinikka & Jakob Svensson, 2005. "Fighting Corruption to Improve Schooling: Evidence from a Newspaper Campaign in Uganda," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 259-267, 04/05.
  22. T. D. Stanley, 2005. "Beyond Publication Bias," Journal of Economic Surveys, Wiley Blackwell, vol. 19(3), pages 309-345, 07.
  23. Vial, Virginie & Hanoteau, Julien, 2010. "Corruption, Manufacturing Plant Growth, and the Asian Paradox: Indonesian Evidence," World Development, Elsevier, vol. 38(5), pages 693-705, May.
  24. Jakob Svensson, 2005. "Eight Questions about Corruption," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 19-42, Summer.
  25. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
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