Income Shocks and Corruption in Africa : Does a Virtuous Cycle Exist?
Empirical evidence suggests that governance quality is a key driver of economic growth and that, in turn, higher incomes might have a positive causal effect on the quality of governance. Such complementarity could invite virtuous cycles of development. Using a measure of corruption as our proxy for the quality of governance, and rainfall as an instrument for income, we explore this issue and find evidence to the contrary. For a panel of African countries, positive income shocks on average tend to invite extra corruption. Closer inspection, however, reveals that this result can be attributed to the most corrupt countries. Conversely, countries with a sufficiently low level of corruption can escape the detrimental effect of income booms on corruption and may actually experience a virtuous cycle of development.
| Main Authors: | , , |
|---|---|
| Format: | Journal Article biblioteca |
| Language: | EN |
| Published: |
2011
|
| Subjects: | Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior D720, Bureaucracy, Administrative Processes in Public Organizations, Corruption D730, Illegal Behavior and the Enforcement of Law K420, Formal and Informal Sectors, Shadow Economy, Institutional Arrangements O170, Institutions and Growth O430, Measurement of Economic Growth, Aggregate Productivity, Cross-Country Output Convergence O470, |
| Online Access: | http://hdl.handle.net/10986/5005 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|