Table of Contents

International Handbook on the Economics of Corruption, Volume Two

International Handbook on the Economics of Corruption, Volume Two

Elgar original reference

Edited by Susan Rose-Ackerman and Tina Søreide

A companion volume to the International Handbook on the Economics of Corruption published in 2006, the specially commissioned papers in Volume Two present some of the best policy-oriented research in the field. They stress the institutional roots of corruption and include new research on topics ranging from corruption in regulation and procurement to vote buying and private firm payoffs.

Chapter 2: Curbing Corruption with Political Institutions

Joshua D. Potter and Margit Tavits

Subjects: economics and finance, economic crime and corruption, law - academic, corruption and economic crime, law and economics

Extract

Joshua D. Potter and Margit Tavits 1. Introduction The determinants of corruption are often cast in an economic light. Explanatory variables such as level of economic development and trade openness have consistently been demonstrated to correlate with lower levels of corruption (Ades and Di Tella, 1999; Gerring and Thacker, 2005; Treisman, 2000). However, the causes of corruption are not purely economic in nature. Corruption varies across countries with similar levels of development and across those that are equally open to trade. Treisman (2007), for example, controlling for economic development, finds that political rights are significantly related to lower perceived levels of corruption. Other scholars have posited that a number of cultural, demographic, and institutional variables directly come to bear on a country’s level of corruption (Klitgaard et al., 2002; Sandholtz and Taagepera, 2005; Treisman, 2000, 2007). In this chapter, we focus on one set of these variables – political institutions – and summarize the literature that links institutions as an explanatory variable to corruption as an outcome. We paint with rather broad brushstrokes and deal with a slightly different form of corruption compared to other chapters in this volume – that is, political corruption. By this we mean a range of explicitly political activities such as campaign financing, bribery, and nepotism, but we also acknowledge that political corruption might be more broadly construed as public sector corruption. And, indeed, we think that the logic we summarize from the political institutional literature has something to say about the other types of corruption as well,...

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