IDEAS home Printed from https://ideas.repec.org/p/pas/asarcc/2009-15.html
   My bibliography  Save this paper

Economic Growth, Law and Corruption: Evidence from India

Author

Listed:
  • Sambit Bhattacharyya
  • Raghbendra Jha

Abstract

In 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 novel panel dataset covering 20 Indian states and the periods 2005 and 2008 we estimate the causal effects of economic growth and law on corruption. To tackle endogeneity concerns we use forest share to total land area as an instrument for economic growth. We notice that forest share is a positive predictor of growth. This is in line with the view that forestry contributes positively to economic growth. To capture the effect of law on corruption we use the 'difference-in-difference' estimation method. Our results indicate that economic growth reduces overall corruption as well as corruption in banking, land administration, education, electricity, and hospitals. Growth however has little impact on corruption perception. In contrast the RTI Act reduces both corruption experience and corruption perception. Our basic result holds after controlling for state fixed effects and various additional covariates. It is also robust to alternative instruments and outlier sensitivity tests.

Suggested Citation

  • Sambit Bhattacharyya & Raghbendra Jha, 2009. "Economic Growth, Law and Corruption: Evidence from India," ASARC Working Papers 2009-15, The Australian National University, Australia South Asia Research Centre.
    • Handle: RePEc:pas:asarcc:2009-15
    as

    Download full text from publisher

    File URL: https://crawford.anu.edu.au/acde/asarc/pdf/papers/2009/WP2009_15.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    Citations

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


    Cited by:

    1. Yamamura, Eiji, 2011. "Groups and information disclosure: Olson and Putnam Hypotheses," MPRA Paper 34628, University Library of Munich, Germany.
    2. 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.
    3. 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.
    4. 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.
    5. 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.
    6. Yamamura, Eiji, 2012. "Effects of groups and government size on information disclosure," MPRA Paper 36141, University Library of Munich, Germany.

    More about this item

    Keywords

    Economic Growth; Law; Corruption;
    All these keywords.

    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

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:pas:asarcc:2009-15. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Raghbendra Jha (email available below). General contact details of provider: https://edirc.repec.org/data/asanuau.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.