publication . Article . Preprint . 1997

Corruption, public investment and growth

Vito Tanzi; Hamid R Davoodi;
Open Access Japanese
  • Published: 01 Oct 1997 Journal: 三田学会雑誌, volume 91, issue 1, pages 12-26 (issn: 0026-6760, Copyright policy)
  • Publisher: 慶應義塾経済学会
Abstract
Corruption, particularly political or “grand” corruption, distorts the entire decision-making process connected with public investment projects. The degree of distortions is higher with weaker auditing institutions. The evidence presented shows that higher corruption is associated with (i) higher public investment; (ii) lower government revenues; (iii) lower expenditures on operations and maintenance; and (iv) lower quality of public infrastructure. The evidence also shows that corruption increases public investment while reducing its productivity. These are five channels through which corruption lowers growth. An implication is that economists should be more re...
Subjects
free text keywords: Corruption;public investment, growth, productivity, government revenue, current expenditure, investment projects, government finance statistics
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publication . Article . Preprint . 1997

Corruption, public investment and growth

Vito Tanzi; Hamid R Davoodi;