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Growth and development under different corruption regimes
Author(s) -
Wang Yuan
Publication year - 2020
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/manc.12302
Subject(s) - language change , embezzlement , economics , china , collusion , ranking (information retrieval) , rent seeking , development economics , political science , microeconomics , politics , law , criminal law , art , literature , machine learning , computer science
This paper explicitly models four different corruption regimes according to the way in which corruption is practised. It distinguishes between organized and disorganized, collusive and non‐collusive corruption. The implications of these are compared and contrasted to provide ranking regarding their impacts on growth. Corruption is always bad, but the extent of the detrimental effect on growth is sensitive to the corruption regime observed. The least (or most) damaging regime is the one in which corruption is both organized and collusive (or disorganized and non‐collusive), as broadly characterizes the situation in China and its fast‐growing neighbours (or some African countries). An effective anti‐corruption policy should focus on fighting embezzlement and discretionary rent‐seeking first, which will dramatically reduce the adverse effect of corruption on growth.