Is corruption an efficient grease?

Arbeitspapier

This paper tests whether corruption may act as an efficient grease for the wheels of an otherwise deficient institutional framework. We analyze the interaction between aggregate efficiency, corruption, and other dimensions of governance for a panel of 54 developed and developing countries. Using three measures of corruption and five measures of other aspects of governance, we observe that corruption is consistently detrimental in countries where institutions are effective, but that it may be positively associated with efficiency in countries where institutions are ineffective. We thus find evidence of the grease the wheels hypothesis.

Object Details

• ISBN: 978-952-462-931-7
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: BOFIT Discussion Papers ; No. 20/2008

Classification and Topics

• Classification: Wirtschaft ; Multiple or Simultaneous Equation Models: Panel Data Models; Spatio-temporal Models ; Institutions and Growth ; Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
• Subject: governance ; corruption ; income ; aggregate productivity ; efficiency

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Méon, Pierre-Guillaume ; Weill, Laurent
• Event: Veröffentlichung
• (who): Bank of Finland, Institute for Economies in Transition (BOFIT)
• (where): Helsinki
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/212633
• Last update: 10.03.2025, 11:44 AM CET