Localization and Corruption: Panacea or Pandora's Box?

By Tugrul Gurgur, Anwar Shah. 2005

196 citations recorded by the source corpus.

An extensive literature on the relationship between decentralization (or localization) and corruption has developed in recent years. While some authors argue that there is a positive relationship between decentralization and corruption, others claim that decentralization in fact leads to a reduction in the level of corruption. This important policy question has not yet been laid to rest, since previous empirical work simply uses eclectic regressions and lacks a conceptual framework to discover the root causes of corruption. This paper attempts to fill this void by presenting a framework in identifying the drivers of corruption both conceptually and empirically in order to isolate the role of centralized decision-making on corruption. The following results emerge: 1) For a sample of 30 countries (developing and industrial), corruption is caused by: a lack of service-orientation in the public sector, weak democratic institutions, economic isolation (closed economy), colonial past, internal bureaucratic controls and centralized decision making. 2) Decentralization is found to have a negative impact on corruption, with the effect being stronger in unitary than in federal countries.

Subfields: Economics and Econometrics, Political Science and International Relations, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/e97fd80d9d7e0fd8df4a6e127b85f7c38183ba22

Citations in the corpus

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