The Persistence of Corruption and Slow Economic Growth

By Paolo Mauro. Social Science Research Network, 2002

427 citations recorded by the source corpus.

There is increasing recognition that corruption has substantial, adverse effects on economic growth. But if the costs of corruption are so high, why don't countries strive to improve their institutions and root out corruption? Why do many countries appear to be stuck in vicious circles of widespread corruption and low economic growth, often accompanied by ever-changing governments through revolutions and coups? A possible explanation is that when corruption is widespread, individuals do not have incentives to fight it even if everybody would be better off without it. Two models involving strategic complementarities and multiple equilibria attempt to illustrate this formally.

Subfields: Economics and Econometrics, Information Systems, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/896441eba37306a7fe9967f104d809623fbc2622

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Citations in the corpus

The social cost of rent seeking in Europe (2009, background): “Here, following for instance Zak and Knack (2001), Mauro (2004) and Park et al. (2005), we simply assume that Θt increases with per capita rent-seeking activities, PNt h=1 1 − ηhtð ÞHht Nt (see Section 7 for a richer specification).”
The Cluster Policies Whitebook (2004, background): “This makes room for political discretion at the expense of SMEs and under-privileged firms, and worsens the presence of agency problems in public funding as well as in foreign financial contributions (Scleifer and Vishny, 1994; Mauro, 2002; Tangkitvanich, 2004).”
Corruption and Transparency in a Growth Model (2006, methodology): “The contribution of this paper differs from those of Mauro (op. cit.)”
Corruption and the environmental Kuznets Curve: Empirical evidence for sulfur (2010, background): “Moreover, the countries’ degree of corruption has been quite persistent and some countries appear to be stuck in a vicious circle of widespread corruption and low economic growth (Mauro [37]).”
After the Crisis: Industrial Policy and the Developmental State in Low‐Income Countries (2010, background): “Paulo Mauro puts it the other way around in a recent IMF Staff Paper: ‘a consensus seems to have emerged that corruption and other aspects of poor governance and weak institutions have substantial, adverse effects on economic growth’ (Mauro, 2004).”
Formal and Informal Corruption Environments and Multinational Enterprise Social Irresponsibility (2015, neutral): “There is a cultural persistence to widespread corruption that makes it difficult for individuals in a pervasively corrupt environment to avoid its effects (Mauro, 2004).”
Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets (2007, neutral): “Theories of norms and corruption are presented in Mauro (2004), which discusses models of multiple equilibria in corruption levels that could be interpreted as capturing corruption culture, and in Tirole (1996), which develops a model of bureaucratic collective reputation that also implies…”
Growth and Governance: Models, Measures, and Mechanisms (2007, background): “We merely claim that they are likely to be more effective in the context of changes to underlying socioeconomic characteristics that are themselves likely to reduce malgovernance.”