Corruption, Decentralization and Yardstick Competition

Dincer, Oguzhan C.; Ellis, Christopher J.; Waddell, Glen R.

doi:10.2139/ssrn.877470

Corruption, Decentralization and Yardstick Competition

22 Pages Posted: 22 Jan 2006

See all articles by Oguzhan C. Dincer

Oguzhan C. Dincer

Illinois State University - Department of Economics; Illinois State University-Institute for Corruption Studies

Christopher J. Ellis

University of Oregon - Department of Economics

Glen R. Waddell

University of Oregon - Department of Economics; Institute for the Study of Labor (IZA)

Date Written: June 2006

Abstract

Several empirical studies have found a negative relationship between corruption and the decentralization of the powers to tax and spend. In this paper we explain this phenomenon using a model of Yardstick Competition. Using data on federal corruption-related convictions in U.S. states we propose and test a spatial autoregressive model of corruption, providing new evidence in support of the theoretical findings.

Keywords: Corruption, decentralization, yardstick competition, spatial autoregression

JEL Classification: H20, H29

Suggested Citation: Suggested Citation

Dincer, Oguzhan C. and Ellis, Christopher J. and Waddell, Glen R., Corruption, Decentralization and Yardstick Competition (June 2006). Available at SSRN: https://ssrn.com/abstract=877470 or http://dx.doi.org/10.2139/ssrn.877470