The economic effect of corruption in Italy: a regional panel analysis

Abstract

This paper provides a within-country analysis of the impact of corruption on economic growth using a panel of Italian regions from 1968 to 2011 through a robust measure of corruption. This measure is averaged over 5-year periods to reduce short-run fluctuations and to reduce probable delayed effects, which are typical for latent phenomena such as corruption. The results show a significant negative impact of corruption on long-term growth in all specifications, both on average and for each Italian region. As a consequence, a zero-level of corruption is growth maximizing. This effect is non-linear such that the negative impact of corruption on growth becomes less intense as corruption increases.

Corruption impacting regional economic growth: A dynamic panel data analysis for the case of Vietnam

“…Most of the studies on this topic have been conducted at a cross-country level and have been criticized due to the incomparability of various institutional characteristics (Del Monte & Papagni, 2001;Lisciandra & Millemaci, 2017) and corruption measures across countries (Glaeser & Saks, 2006); thus, a crossregional, within-country study could provide more insight into the consequences of corruption. Indeed, there are some within-country studies that focus on the examples of Italy and the United States (Del Monte & Papagni, 2001;Glaeser & Saks, 2006;Lisciandra & Millemaci, 2017). However, regional studies of developed countries could not be generalized to other countries around the world, where most are considered developing, with rampant corrupt activities (Glaeser & Saks, 2006).…”

“…A huge disparity exists between nations, not only in their levels of corruption but also in other institutional elements, such as administrative control, government subsidies, or the number of state-owned enterprises, which cross-country data are incapable of controlling for. Studies on regions within a country with more homogeneous characteristics could moderate any omitted variable bias that emerged from those differences (Del Monte & Papagni, 2001;Lisciandra & Millemaci, 2017). In addition, cross-country studies often depend on survey-based corruption data, which raises two concerns that have been discussed by Glaeser and Saks (2006).…”

“…Rather than survey‐based corruption data, most of these within‐country studies use corruption data that is based on reported crime statistics. Both Del Monte and Papagni (2001) and Lisciandra and Millemaci (2017) reviewed Italian regions and found that corruption inhibits economic growth in those regions. Lisciandra and Millemaci (2017) proved that corruption deterred Italian regional growth because it limited private investment and simultaneously caused inefficiencies in public investment.…”

“…This article aims to address this research gap, by becoming the first comprehensive analysis to provide empirical evidence on the consequences of corruption on Vietnamese provincial economic growth, and to contribute to an ongoing line of research on this topic. Most of the studies on this topic have been conducted at a cross‐country level and have been criticized due to the incomparability of various institutional characteristics (Del Monte & Papagni, 2001; Lisciandra & Millemaci, 2017) and corruption measures across countries (Glaeser & Saks, 2006); thus, a cross‐regional, within‐country study could provide more insight into the consequences of corruption. Indeed, there are some within‐country studies that focus on the examples of Italy and the United States (Del Monte & Papagni, 2001; Glaeser & Saks, 2006; Lisciandra & Millemaci, 2017).…”

The Impacts of Anti-Corruption on Economic Growth in China

“…It is held by a multitude of economists that corruption is an important obstacle of economic growth [3]- [6], and many scholars conducted wide-spread research on the impacts of corruption in economic growth using the cross-country samples, and they unanimously found that [7]- [10] corruption features significant negative impacts on economic growth and investment growth.…”