Corruption, seigniorage and growth: theory and evidence

Arbeitspapier

This paper presents an analysis of the effect of bureaucratic corruption on economic growth through a public finance transmission channel. At the theoretical level, we develop a simple dynamic general equilibrium model in which financial intermediaries make portfolio decisions on behalf of agents, and bureaucrats collect tax revenues on behalf of the government. Corruption takes the form of the embezzlement of public funds, the effect of which is to increase the government's reliance on seigniorage finance. This leads to an increase in inflation which, in turn, reduces capital accumulation and growth. At the empirical level, we use data on 82 countries over a 20-year period to test the predictions of our model. Taking proper account of the government's budget constraint, we find strong evidence to support these predictions under different estimation strategies. Our results are robust to a wide range of sensitivity tests.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CESifo Working Paper ; No. 2354

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance ; Formal and Informal Sectors; Shadow Economy; Institutional Arrangements ; Monetary Growth Models
• Thema: Corruption ; seigniorage ; inflation ; growth ; Korruption ; Steueraufkommen ; Betrug ; Münzgewinn ; Inflation ; Wirtschaftswachstum ; Theorie ; Schätzung ; Welt

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Blackburn, Keith ; Neanidis, Kyriakos C. ; Haque, M. Emranul
• Ereignis: Veröffentlichung
• (wer): Center for Economic Studies and ifo Institute (CESifo)
• (wo): Munich
• (wann): 2008

Weitere Informationen

• Handle: http://hdl.handle.net/10419/26399
• Letzte Aktualisierung: 20.09.2024, 08:22 MESZ