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Fiscal Capacity and the Quality of Government in Sub-Saharan Africa

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  • Baskaran, Thushyanthan
  • Bigsten, Arne

Abstract

Historical evidence from the industrialized world suggests that the expansion of the modern state’s capacity to tax eventually led to more democratic and less corrupt governments. Using a dataset that covers 31 sub-Saharan African countries over the 1990–2005 period, we study whether the positive effect of fiscal capacity on the quality of government prevails in contemporaneous sub-Saharan Africa as well. The results provide consistent evidence that within sub-Saharan Africa, fiscal capacity decreases corruption and increases democracy.

Suggested Citation

  • Baskaran, Thushyanthan & Bigsten, Arne, 2013. "Fiscal Capacity and the Quality of Government in Sub-Saharan Africa," World Development, Elsevier, vol. 45(C), pages 92-107.
    • Handle: RePEc:eee:wdevel:v:45:y:2013:i:c:p:92-107
    DOI: 10.1016/j.worlddev.2012.09.018
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