Corruption & the Wealth of Nations

33 Pages Posted: 18 Oct 2021

See all articles by Jamie Bologna Pavlik

Jamie Bologna Pavlik

Texas Tech University - Department of Agricultural and Applied Economics

Robin Grier

Texas Tech University - Free Market Institute

Kevin B. Grier

Texas Tech University

Date Written: October 2021

Abstract

Corruption is often cited as a fundamental obstacle to economic development, making anticorruption initiatives an important policy objective. However, there is little convincing empirical
evidence concerning the benefits of anti-corruption reform. We fill this gap by identifying a set of
countries that experienced a sustained increase in corruption control and compare the outcomes of
this group with a counterfactual set of similar countries that experienced no such change. We find
some evidence that corruption reforms significantly raise real GDP per-capita. We also find that
many corruption reforms are temporary, emphasizing the need to focus on sustainability when
engaging in corruption reform. We document for the first time a strong asymmetry of results, as
countries that experience a large discrete increase in corruption do not suffer a significant decline in
real GDP per-capita.

Keywords: Corruption, Anticorruption, Reform, Economic Performance

JEL Classification: D73, P41, O4, O47

Suggested Citation

Bologna Pavlik, Jamie and Grier, Robin and Grier, Kevin B., Corruption & the Wealth of Nations (October 2021). Free Market Institute Research Paper No. 3942921, Available at SSRN: https://ssrn.com/abstract=3942921 or http://dx.doi.org/10.2139/ssrn.3942921

Jamie Bologna Pavlik

Texas Tech University - Department of Agricultural and Applied Economics ( email )

Suite 167, 2625 Memorial Circle
TTU Administration
Lubbock, TX 79409
United States

Robin Grier

Texas Tech University - Free Market Institute ( email )

Box 45059
Lubbock, TX 79409-5059
United States

Kevin B. Grier (Contact Author)

Texas Tech University ( email )

2500 Broadway
Lubbock, TX 79409
United States

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