What Have We Learned About the Causes of Corruption from Ten Years of Cross-National Empirical Research?

Abstract

▪ Abstract I review recent efforts by political scientists and economists to explain cross-national variation in corruption using subjective ratings, and examine the robustness of reported findings. Quite strong evidence suggests that highly developed, long-established liberal democracies, with a free and widely read press, a high share of women in government, and a history of openness to trade, are perceived as less corrupt. Countries that depend on fuel exports or have intrusive business regulations and unpredictable inflation are judged more corrupt. Although the causal direction is usually unclear, instrumenting with income as of 1700 suggests higher development does cause lower perceived corruption. However, controlling for income, most factors that predict perceived corruption do not correlate with recently available measures of actual corruption experiences (based on surveys of business people and citizens that ask whether they have been expected to pay bribes recently). Reported corruption experiences correlate with lower development, and possibly with dependence on fuel exports, lower trade openness, and more intrusive regulations. The subjective data may reflect opinion rather than experience, and future research could usefully focus on experience-based indicators.