Inequality and Corruption: Evidence from US States
High-quality data on state-level inequality and incomes, panel data on corruption convictions, and careful attention to the consequences of including or excluding fixed effects in the panel specification allow us to estimate the impact of income considerations on the decision to undertake corrupt acts. Following efficiency wage arguments, for a given institutional environment the corruptible employee’s or official’s decision to engage in corruption is affected by relative wages and expected tenure in the public sector, the probability of detection, the cost of fines and jail terms, and the degree of inequality, which indicate diminished prospects facing those convicted of corruption. In US states over 25 years we show that inequality and higher government relative wages significantly and robustly produce less corruption. This reverses other findings of a positive association between inequality and corruption, which we show arises from long-run joint causation by unobserved factors.
|Date of creation:||Aug 2008|
|Contact details of provider:|| Postal: Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark|
Phone: (+45) 3532 4411
Fax: +45 35 32 30 00
Web page: http://www.econ.ku.dk/epru/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mookherjee, Dilip & Png, I P L, 1995. "Corruptible Law Enforcers: How Should They Be Compensated?," Economic Journal, Royal Economic Society, vol. 105(428), pages 145-159, January.
- Torsten Persson & Guido Tabellini & Francesco Trebbi, 2003.
"Electoral Rules and Corruption,"
Journal of the European Economic Association,
MIT Press, vol. 1(4), pages 958-989, 06.
- Torsten Persson & Guido Tabellini & Francesco Trebbi, "undated". "Electoral Rules and Corruption," Working Papers 182, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Persson, Torsten & Tabellini, Guido & Trebbi, Francesco, 2001. "Electoral Rules and Corruption," CEPR Discussion Papers 2741, C.E.P.R. Discussion Papers.
- Torsten Persson & Guido Tabellini & Francesco Trebbi, 2001. "Electoral Rules and Corruption," CESifo Working Paper Series 416, CESifo Group Munich.
- Torsten Persson & Guido Tabellini & Francesco Trebbi, 2001. "Electoral Rules and Corruption," NBER Working Papers 8154, National Bureau of Economic Research, Inc.
- Eric M. Uslaner, 2011. "Corruption and Inequality," CESifo DICE Report, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(2), pages 20-24, 07.
- Uslaner, Eric M., 2006. "Corruption and Inequality," WIDER Working Paper Series 034, World Institute for Development Economic Research (UNU-WIDER).
- Richard T. Boylan, 2005. "What Do Prosecutors Maximize? Evidence from the Careers of U.S. Attorneys," American Law and Economics Review, Oxford University Press, vol. 7(2), pages 379-402.
- Glaeser, Edward L. & Saks, Raven E., 2006. "Corruption in America," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1053-1072, August.
- Oguzhan Dincer & Christopher Ellis & Glen Waddell, 2010. "Corruption, decentralization and yardstick competition," Economics of Governance, Springer, vol. 11(3), pages 269-294, June.
- Christopher J. Ellis & Oguzhan C. Dincer & Glenn R. Waddell, 2005. "Corruption, Decentralization and Yardstick Competition," University of Oregon Economics Department Working Papers 2005-5, University of Oregon Economics Department, revised 01 Jan 2006.
- Gerring, John & Thacker, Strom C., 2004. "Political Institutions and Corruption: The Role of Unitarism and Parliamentarism," British Journal of Political Science, Cambridge University Press, vol. 34(02), pages 295-330, April.
- Tugrul Gurgur & Anwar Shah, 2014. "Localization and corruption: panacea or pandora's box?," Annals of Economics and Finance, Society for AEF, vol. 15(1), pages 109-136, May.
- Gurgur, Tugrul & Shah, Anwar, 2005. "Localization and corruption : panacea or pandora's box?," Policy Research Working Paper Series 3486, The World Bank.
- Tugrul Gurgur & Anwar Shah, 2008. "Localization and corruption: panacea or pandora's box?," CEMA Working Papers 581, China Economics and Management Academy, Central University of Finance and Economics.
- Wilson, Sven E. & Butler, Daniel M., 2007. "A Lot More to Do: The Sensitivity of Time-Series Cross-Section Analyses to Simple Alternative Specifications," Political Analysis, Cambridge University Press, vol. 15(02), pages 101-123, March.
- Edward F. Blackburne III & Mark W. Frank, 2007. "Estimation of nonstationary heterogeneous panels," Stata Journal, StataCorp LP, vol. 7(2), pages 197-208, June.
- Mark W. Frank, 2009. "Inequality And Growth In The United States: Evidence From A New State-Level Panel Of Income Inequality Measures," Economic Inquiry, Western Economic Association International, vol. 47(1), pages 55-68, 01.
- Edward L. Glaeser & Claudia Goldin, 2006. "Corruption and Reform: Introduction," NBER Chapters,in: Corruption and Reform: Lessons from America's Economic History, pages 2-22 National Bureau of Economic Research, Inc.
- Craig Depken & Courtney Lafountain, 2006. "Fiscal consequences of public corruption: Empirical evidence from state bond ratings," Public Choice, Springer, vol. 126(1), pages 75-85, January.
- Goel, Rajeev K & Nelson, Michael A, 1998. "Corruption and Government Size: A Disaggregated Analysis," Public Choice, Springer, vol. 97(1-2), pages 107-120, October. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:kud:epruwp:08-02. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Hoffmann)
If references are entirely missing, you can add them using this form.