Corruption and Social Interaction: Evidence from China

Bin Dong and Benno Torgler

CREMA Working Paper Series from Center for Research in Economics, Management and the Arts (CREMA)

Abstract: We explore theoretically and empirically whether social interaction, including local and global interaction, influences the incidence of corruption. We first present an interaction-based model on corruption that predicts that the level of corruption is positively associated with social interaction. Then we empirically verify the theoretical prediction using within-country evidence at the province-level in China during 1998 to 2007. Panel data evidence clearly indicates that social interaction has a statistically significantly positive effect on the corruption rate in China. Our findings, therefore, underscore the relevance of social interaction in understanding corruption.

Keywords: Awards; Signals; Status; Anonymity; Globalization (search for similar items in EconPapers)
JEL-codes: D64 D72 J24 K42 O17 (search for similar items in EconPapers)
Date: 2010-11
New Economics Papers: this item is included in nep-dev, nep-law, nep-soc and nep-tra
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Related works:
Journal Article: Corruption and social interaction: Evidence from China (2012)
Working Paper: Corruption and Social Interaction: Evidence from China (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:cra:wpaper:2010-22

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