Literature abounds to show that the current anti-corruption strategies have failed to fight corruption because of neglect of ethics in these strategies, despite its importance. The purpose of this paper is to make a contribution to anti-corruption theory by developing a model that clarifies many complex ethical dilemmas around corruption. To develop a conceptual model, the extant literatures on...

This study furthers our understanding of how corruption affects the decision-making process of allocating foreign direct investment (FDI). Drawing on the responses of 28 managers in charge of establishing operations in a highly corrupt host country, we argue that those firms based in home countries with low levels of corruption are more proactive in preparing to face corruption abroad than thos...

Corruption is an important economic variable but one that is extremely difficult to measure. As a result, researchers have resorted to using perception indexes as a proxy for true corruption. Recent studies suggest that perception measures are inaccurate, and have encouraged the use of methodologies that can measure fact-based corruption – corruption that actually takes place. In this paper, we...

In this chapter I present some preliminary results on the nature of corruption and countervailing action in Pakistan, drawing on data extracted from newspapers. Once it is recognized that corruption creates losers as well as winners, some dramatic implications for the theory of corruption emerge. This leads to an analysis of the countervailing action taken by losers to offset their losses from ...

This paper presents theoretical and empirical evidence on the nexus between corruption and democracy. We establish a political economy model where the effect of democracy on corruption is conditional on income distribution and property rights protection. Our empirical analysis with cross-national panel data provides evidence that is consistent with the theoretical prediction. Moreover, the effe...

Fighting corruption is a vital aspect of good governance. When assessing government performance voters should thus withdraw electoral support from government parties that turn a blind eye to or even engage in corrupt practices. Whereas most accounts of performance-based voting focus on economic outcomes, we analyse whether and to what extent voters punish incumbents for high levels of corruptio...

This paper considers the role of corruption in impelling capital flight. Identifying corruption as one dimension of poor governance, the empirical analysis explores direct linkages between corruption and capital flight in a broad sample of countries. The novelty of this investigation is that it is based on a portfolio choice model of asset allocation that explicitly recognizes corruption as con...

The author builds an agent-based model wherein the societal corruption level is derived from individual corruption levels optimally chosen by heterogeneous agents with different risk aversion and human capital. The societal corruption level, in turn, affects the risk-return profile of corruption for the individual agents. Simulating a multi-generational economy with heterogeneous agents, the au...

The paper studies the influence of Gordon Tullock (1967) and the rent-seeking literature more generally on the study of corruption. The theoretical corruption literature with its emphasis on principal-agent relationships within government and rent creation by corruption politicians has largely, but not entirely, overlooked that contestable rents encourage unproductive use of real resources in s...

We report quantitative relations between corruption level and economic factors, such as country wealth and foreign investment per capita, which are characterized by a power law spanning multiple scales of wealth and investment per capita. These relations hold for diverse countries, and also remain stable over different time periods. We also observe a negative correlation between level of corrup...