IDEAS home Printed from https://ideas.repec.org/p/ags/feemim/91024.html
   My bibliography  Save this paper

The Causes of Corruption: Evidence from China

Author

Listed:
  • Dong, Bin
  • Torgler, Benno

Abstract

In this study we explore in detail the causes of corruption in China using two different sets of data at the regional level (provinces and cities). We observe that regions with more anti-corruption efforts, histories of British rule, higher openness, more access to media and relatively higher wages of government employees are markedly less corrupt; while social heterogeneity, regulation, abundance of resource and state-owned enterprises substantially breed regional corruption. Moreover, fiscal decentralization is discovered to depress corruption significantly, while administrative decentralization fosters local corruption. We also find that there is currently a positive relationship between corruption and economic development in China that is mainly driven by the transition to a market economy.

Suggested Citation

  • Dong, Bin & Torgler, Benno, 2010. "The Causes of Corruption: Evidence from China," Institutions and Markets Papers 91024, Fondazione Eni Enrico Mattei (FEEM).
    • Handle: RePEc:ags:feemim:91024
    DOI: 10.22004/ag.econ.91024
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/91024/files/NDL2010-072.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.91024?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 1999. "The Quality of Government," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 15(1), pages 222-279, April.
    2. Brunetti, Aymo & Weder, Beatrice, 2003. "A free press is bad news for corruption," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1801-1824, August.
    3. Jakob Svensson, 2003. "Who Must Pay Bribes and How Much? Evidence from a Cross Section of Firms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(1), pages 207-230.
    4. Rafael Di Tella & Alberto Ades, 1999. "Rents, Competition, and Corruption," American Economic Review, American Economic Association, vol. 89(4), pages 982-993, September.
    5. Meng, Xin & Gregory, Robert & Wang, Youjuan, 2005. "Poverty, inequality, and growth in urban China, 1986-2000," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 710-729, December.
    6. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 83-116.
    7. Freille, Sebastian & Haque, M. Emranul & Kneller, Richard, 2007. "A contribution to the empirics of press freedom and corruption," European Journal of Political Economy, Elsevier, vol. 23(4), pages 838-862, December.
    8. Mr. Carlos A Leite & Jens Weidmann, 1999. "Does Mother Nature Corrupt? Natural Resources, Corruption, and Economic Growth," IMF Working Papers 1999/085, International Monetary Fund.
    9. Levin, Mark & Satarov, Georgy, 2000. "Corruption and institutions in Russia," European Journal of Political Economy, Elsevier, vol. 16(1), pages 113-132, March.
    10. AlÌcia Adserý, 2003. "Are You Being Served? Political Accountability and Quality of Government," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 19(2), pages 445-490, October.
    11. Benno Torgler & Neven T. Valev, 2010. "Gender And Public Attitudes Toward Corruption And Tax Evasion," Contemporary Economic Policy, Western Economic Association International, vol. 28(4), pages 554-568, October.
    12. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    13. Rappaport, Jordan & Sachs, Jeffrey D, 2003. "The United States as a Coastal Nation," Journal of Economic Growth, Springer, vol. 8(1), pages 5-46, March.
    14. Mo, Pak Hung, 2001. "Corruption and Economic Growth," Journal of Comparative Economics, Elsevier, vol. 29(1), pages 66-79, March.
    15. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and corruption: evidence across countries," Journal of Public Economics, Elsevier, vol. 83(3), pages 325-345, March.
    16. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and Corruption: Evidence from U.S. Federal Transfer Programs," Public Choice, Springer, vol. 113(1-2), pages 25-35, October.
    17. Bryan W Husted, 1999. "Wealth, Culture, and Corruption," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 30(2), pages 339-359, June.
    18. Arvind K. Jain, 2001. "Corruption: A Review," Journal of Economic Surveys, Wiley Blackwell, vol. 15(1), pages 71-121, February.
    19. Lorenzo Pellegrini & Reyer Gerlagh, 2008. "Causes of corruption: a survey of cross-country analyses and extended results," Economics of Governance, Springer, vol. 9(3), pages 245-263, July.
    20. Brennan,Geoffrey & Buchanan,James M., 2006. "The Power to Tax," Cambridge Books, Cambridge University Press, number 9780521027922, January.
    21. Zhang, Tao & Zou, Heng-fu, 1998. "Fiscal decentralization, public spending, and economic growth in China," Journal of Public Economics, Elsevier, vol. 67(2), pages 221-240, February.
    22. Glaeser, Edward L. & Saks, Raven E., 2006. "Corruption in America," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1053-1072, August.
    23. Hongyi Li & Lixin Colin Xu & Heng‐fu Zou, 2000. "Corruption, Income Distribution, and Growth," Economics and Politics, Wiley Blackwell, vol. 12(2), pages 155-182, July.
    24. Weingast, Barry R, 1995. "The Economic Role of Political Institutions: Market-Preserving Federalism and Economic Development," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(1), pages 1-31, April.
    25. Jin, Hehui & Qian, Yingyi & Weingast, Barry R., 2005. "Regional decentralization and fiscal incentives: Federalism, Chinese style," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1719-1742, September.
    26. Van Rijckeghem, Caroline & Weder, Beatrice, 2001. "Bureaucratic corruption and the rate of temptation: do wages in the civil service affect corruption, and by how much?," Journal of Development Economics, Elsevier, vol. 65(2), pages 307-331, August.
    27. Hongbin Cai & Hanming Fang & Lixin Colin Xu, 2011. "Eat, Drink, Firms, Government: An Investigation of Corruption from the Entertainment and Travel Costs of Chinese Firms," Journal of Law and Economics, University of Chicago Press, vol. 54(1), pages 55-78.
    28. Sendhil Mullainathan & Marianne Bertrand, 2001. "Do People Mean What They Say? Implications for Subjective Survey Data," American Economic Review, American Economic Association, vol. 91(2), pages 67-72, May.
    29. Susanto Basu & David Li, 2000. "A Theory of the Reform of Bureaucratic Institutions," Econometric Society World Congress 2000 Contributed Papers 1271, Econometric Society.
    30. Paldam, M. & Svendsen, G.T., 2000. "Missing Social Capital and the Transition in Eastern Europe," Papers 00-5, Aarhus School of Business - Department of Economics.
    31. Dollar, David & Fisman, Raymond & Gatti, Roberta, 2001. "Are women really the "fairer" sex? Corruption and women in government," Journal of Economic Behavior & Organization, Elsevier, vol. 46(4), pages 423-429, December.
    32. Chowdhury, Shyamal K., 2004. "The effect of democracy and press freedom on corruption: an empirical test," Economics Letters, Elsevier, vol. 85(1), pages 93-101, October.
    33. Goel, Rajeev K & Nelson, Michael A, 1998. "Corruption and Government Size: A Disaggregated Analysis," Public Choice, Springer, vol. 97(1-2), pages 107-120, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Belousova, Veronika & Rajeev, K. Goel & Korhonen, Iikka, 2011. "Causes of Corruption in Russia: A Disaggregated Analysis," Discussion Paper Series 557, Institute of Economic Research, Hitotsubashi University.
    2. Belousova, Veronika & Rajeev, K. Goel & Korhonen, Iikka, 2011. "Causes of Corruption in Russia: A Disaggregated Analysis," Discussion Paper Series 557, Institute of Economic Research, Hitotsubashi University.
    3. Cousin, Violaine, 2011. "中监为体、西监为用 or the specifics of Chinese bank regulation," MPRA Paper 36040, University Library of Munich, Germany.
    4. repec:zbw:bofitp:2011_031 is not listed on IDEAS
    5. Lian, Hongping & Li, Hui & Ko, Kilkon, 2019. "Market-led transactions and illegal land use: Evidence from China," Land Use Policy, Elsevier, vol. 84(C), pages 12-20.
    6. Bin Dong & Benno Torgler, 2010. "The Consequences of Corruption: Evidence from China," Working Papers 2010.73, Fondazione Eni Enrico Mattei.
    7. Rajeev Goel & Jelena Budak & Edo Rajh, 2012. "Factors Driving Bribe Payments: Survey Evidence from Croatia," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 19(1), pages 13-22, September.
    8. repec:hhs:bofitp:2011_031 is not listed on IDEAS
    9. Veronika Belousova & Rajeev Goel & Iikka Korhonen, 2016. "Corruption perceptions versus corruption incidence: Competition for rents across Russian regions," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 40(1), pages 172-187, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dong, Bin & Torgler, Benno, 2013. "Causes of corruption: Evidence from China," China Economic Review, Elsevier, vol. 26(C), pages 152-169.
    2. Bin Dong & Benno Torgler, 2010. "The Causes of Corruption: Evidence from China," Working Papers 2010.72, Fondazione Eni Enrico Mattei.
    3. Bin Dong & Benno Torgler, 2010. "The Causes of Corruption: Evidence from China," Working Papers 2010.72, Fondazione Eni Enrico Mattei.
    4. Eugen Dimant & Guglielmo Tosato, 2018. "Causes And Effects Of Corruption: What Has Past Decade'S Empirical Research Taught Us? A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 335-356, April.
    5. Bin Dong & Benno Torgler, 2010. "The Consequences of Corruption: Evidence from China," Working Papers 2010.73, Fondazione Eni Enrico Mattei.
    6. Bin Dong & Benno Torgler, 2010. "The Consequences of Corruption: Evidence from China," Working Papers 2010.73, Fondazione Eni Enrico Mattei.
    7. Günther G. Schulze & Bambang Suharnoko Sjahrir & Nikita Zakharov, 2016. "Corruption in Russia," Journal of Law and Economics, University of Chicago Press, vol. 59(1), pages 135-171.
    8. Blaise Gnimassoun, Joseph Keneck Massil, 2019. "Determinants of corruption: can we put all countries in the same basket?," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 16(2), pages 239-276, December.
    9. Graf Lambsdorff, Johann, 2005. "Consequences and causes of corruption: What do we know from a cross-section of countries?," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-34-05, University of Passau, Faculty of Business and Economics.
    10. Blaise Gnimassoun & Joseph Keneck Massil, 2016. "Determinants of corruption: Can we put all countries in the same basket?," Working Papers hal-04141599, HAL.
    11. Dong, Bin & Torgler, Benno, 2012. "Corruption and social interaction: Evidence from China," Journal of Policy Modeling, Elsevier, vol. 34(6), pages 932-947.
    12. Gabriel Caldas Montes & Paulo Henrique Luna, 2021. "Fiscal transparency, legal system and perception of the control on corruption: empirical evidence from panel data," Empirical Economics, Springer, vol. 60(4), pages 2005-2037, April.
    13. Dong, Bin & Torgler, Benno, 2012. "Corruption and social interaction: Evidence from China," Journal of Policy Modeling, Elsevier, vol. 34(6), pages 932-947.
    14. Gans-Morse, Jordan & Borges, Mariana & Makarin, Alexey & Mannah-Blankson, Theresa & Nickow, Andre & Zhang, Dong, 2018. "Reducing bureaucratic corruption: Interdisciplinary perspectives on what works," World Development, Elsevier, vol. 105(C), pages 171-188.
    15. Andreas Kyriacou & Oriol Roca sagalés, 2009. "Fiscal descentralization and the quality of government: evidence from panel data," Hacienda Pública Española / Review of Public Economics, IEF, vol. 189(2), pages 131-155, June.
    16. Krisztina Kis-Katos & Günther G. Schulze, 2013. "Corruption in Southeast Asia: a survey of recent research," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 27(1), pages 79-109, May.
    17. You, Jong-Sung & Khagram, Sanjeev, 2004. "Inequality and Corruption," Working Paper Series rwp04-001, Harvard University, John F. Kennedy School of Government.
    18. James E. Alt & David Dreyer Lassen, 2003. "The Political Economy of Institutions and Corruption in American States," Journal of Theoretical Politics, , vol. 15(3), pages 341-365, July.

    More about this item

    Keywords

    Political Economy;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:feemim:91024. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/feemmit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.