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The case for human development: a cross-country analysis of corruption perceptions

  • Peyton, Kyle
  • Belasen, Ariel

Economic studies have demonstrated, both empirically and theoretically, that higher levels of human development (HD) and economic freedom (EF) are associated with lower levels of perceived corruption. This study separately examines the impact of human development and economic freedom on perceived levels of corruption across more than one hundred countries using a novel approach that greatly reduces multicollinear bias in the model. The results from this study confirm that both HD and EF are significant predictors of corruption perception levels. Furthermore, an increase in either HD or EF corresponds to a reduction in corruption perception. When evaluated separately, however, increases in human development are shown to correspond to greater reductions in corruption perception than economic freedom. This is demonstrated with an OLS regression using data collected from a single year and a number of panel estimates that utilize data from multiple years.

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File URL: http://mpra.ub.uni-muenchen.de/31385/1/MPRA_paper_31385.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 31385.

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Date of creation: Jan 2010
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Handle: RePEc:pra:mprapa:31385
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  8. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
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  10. Knowles, Stephen & Owen, P. Dorian, 1995. "Health capital and cross-country variation in income per capita in the Mankiw-Romer-Weil model," Economics Letters, Elsevier, vol. 48(1), pages 99-106, April.
  11. Bidani, Benu & Ravallion, Martin, 1997. "Decomposing social indicators using distributional data," Journal of Econometrics, Elsevier, vol. 77(1), pages 125-139, March.
  12. Lant Pritchett & Lawrence H. Summers, 1996. "Wealthier is Healthier," Journal of Human Resources, University of Wisconsin Press, vol. 31(4), pages 841-868.
  13. Naci Mocan, 2004. "What Determines Corruption? International Evidence from Micro Data," NBER Working Papers 10460, National Bureau of Economic Research, Inc.
  14. Miguel Braun & Rafael Di tella, 2004. "Inflation, Inflation Variability, and Corruption," Economics and Politics, Wiley Blackwell, vol. 16(1), pages 77-100, 03.
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  17. Graeff, P. & Mehlkop, G., 2003. "The impact of economic freedom on corruption: different patterns for rich and poor countries," European Journal of Political Economy, Elsevier, vol. 19(3), pages 605-620, September.
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