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Economic Growth, Law, and Corruption: Evidence from India

Author

Listed:
  • Sambit Bhattacharyya

    (Department of Economics, Jubilee Building, 262, University of Sussex, Brighton BN1 9RF, United Kingdom.)

  • Raghbendra Jha

    (Australia South Asia Research Centre, Arndt-Corden Division of Economics, Australian National University, Canberra 0200, Australia.)

Abstract

Is corruption influenced by economic growth? Are legal institutions such as the ‘Right to Information Act (RTI) 2005’ in India effective in curbing corruption? Using a panel dataset covering 20 Indian states for the years 2005 and 2008 we estimate the effects of growth and law on corruption. Accounting for endogeneity, omitted fixed factors, and other nationwide changes we find that economic growth reduces overall corruption as well as corruption in banking, land administration, education, electricity, and hospitals. Growth reduces bribes but has little impact on corruption perception. In contrast the RTI Act reduces both corruption experience and corruption perception.

Suggested Citation

  • Sambit Bhattacharyya & Raghbendra Jha, 2013. "Economic Growth, Law, and Corruption: Evidence from India," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 55(2), pages 287-313, June.
    • Handle: RePEc:pal:compes:v:55:y:2013:i:2:p:287-313
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    Cited by:

    1. Habib Zafarullah & Noore Alam Siddiquee, 2021. "Open government and the right to information: Implications for transparency and accountability in Asia," Public Administration & Development, Blackwell Publishing, vol. 41(4), pages 157-168, October.
    2. Eiji Yamamura, 2012. "Groups and information disclosure: evidence on the Olson and Putnam hypotheses in Japan," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 39(6), pages 423-439, May.
    3. Yamamura, Eiji, 2011. "Groups and information disclosure: Olson and Putnam Hypotheses," MPRA Paper 34628, University Library of Munich, Germany.
    4. Pethe, Abhay & Tandel, Vaidehi & Gandhi, Sahil, 2012. "Unravelling the anatomy of legal corruption in India: Focusing on the ‘honest graft’ by the politicians," MPRA Paper 39306, University Library of Munich, Germany.
    5. Yamamura, Eiji, 2012. "Effects of groups and government size on information disclosure," MPRA Paper 36141, University Library of Munich, Germany.
    6. Orhan Cengiz, 2021. "The Political Economics of Trade Openness and Its Impacts on Corruption," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 71(71-2), pages 499-525, December.

    More about this item

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H0 - Public Economics - - General
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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