Transparency Pays? Evaluating the Effects of the Freedom of Information Laws on Perceived Government Corruption

Abstract

About 90 countries have adopted Freedom of Information (FOI) laws with the objective of facilitating citizens’ right to access information on government activities expeditiously. It is argued that FOI laws increase transparency and fix accountability of the government. We provide quantitative evidence on the impact of FOI laws on perceived government corruption. Using panel data for 132 countries over the 1990–2011 period, we find that adopting FOI laws after controlling for self-section bias, is associated with an increase in perceived government corruption driven by an increase in detection of corrupt acts. In fact, FOI laws appear to increase the perception of government corruption if combined with a higher degree of media freedom, presence of NGO activism and political competition. However, the perception of government corruption tends to decline with the duration of FOI law adoption. These findings are robust to controlling for endogeneity using instrumental variables, alternative samples and estimation methods.