Composition of Exports and Cross-Country Corruption

28 Pages Posted: 3 Jul 2009

See all articles by Rajeev K. Goel

Rajeev K. Goel

Illinois State University - Department of Economics

Iikka Korhonen

Bank of Finland - Institute for Economies in Transition (BOFIT)

Date Written: June 22, 2009

Abstract

This research examines the connection between a country’s export structure and corruption, incorporating disaggregated data on exports for a recent time period over a large set of nations. We ask whether various types of exports (e.g. agricultural, mineral, manufacturing and fuel) exert similar influences on corruption across nations. Our results suggest that corruption decreases as nations attain prosperity, as economic and political freedoms increase, and with a larger government size. Ceteris paribus, transition countries are also found to be more corrupt. Ethnic and linguistic fractionalizations exert opposite influences on corruption, while religious fractionalization does not seem to matter. Although the effects of ore and manufacturing exports are statistically insignificant, agricultural and fuel exports affect corruption significantly. Our findings for fuel exports support previous research, as well as uniquely demonstrate that the impact of fuel exports is sensitive to the prevailing corruption level. We conclude with a discussion of policy implications.

Keywords: corruption, exports, resource curse, government

JEL Classification: H11, K42, O13

Suggested Citation

Goel, Rajeev K. and Korhonen, Iikka, Composition of Exports and Cross-Country Corruption (June 22, 2009). BOFIT Discussion Paper No. 5/2009. Available at SSRN: https://ssrn.com/abstract=1427807 or http://dx.doi.org/10.2139/ssrn.1427807

Rajeev K. Goel (Contact Author)

Illinois State University - Department of Economics ( email )

Normal, IL 61790-4200
United States

Iikka Korhonen

Bank of Finland - Institute for Economies in Transition (BOFIT) ( email )

P.O.Box 160
Helsinki 00101
Finland

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