Last updated on September 5, 2011
That is the title of a new working paper by Ben Olken and Rohini Pande:
“Recent years have seen a remarkable expansion in economists’ ability to measure corruption. This, in turn, has led to a new generation of well-identified, microeconomic studies. We review the evidence on corruption in developing countries in light of these recent advances, focusing on three questions: how much corruption is there, what are the efficiency consequences of corruption, and what determines the level of corruption. We find robust evidence that corruption responds to standard economic incentive theory, but also that effects of anti-corruption policies often attenuate as officials find alternate strategies to pursue rents.”
I have not had a chance to read the paper yet, but from reading the abstract, this looks like the perfect paper for my students to read in the last module of my development seminar, on institutions, corruption, and governance. I had been looking for such a paper, especially given that Bardhan’s (1997) article is a bit dated and that Fisman and Miguel’s (2008) Economic Gangsters, while very interesting, is a bit too long for a one-week module.