The Impact of Corruption and Rent-Seeking Behavior upon Economic Wealth in the European Union from a Public Choice Approach

Gheorghița Dincă, Marius Sorin Dincă, Camelia Negri and Mihaela Bărbuță
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Gheorghița Dincă: Department of Finance and Accounting, Transilvania University of Braşov, 500036 Braşov, Romania
Marius Sorin Dincă: Department of Finance and Accounting, Transilvania University of Braşov, 500036 Braşov, Romania
Camelia Negri: Department of Finance and Accounting, Transilvania University of Braşov, 500036 Braşov, Romania
Mihaela Bărbuță: Department of Finance and Accounting, Transilvania University of Braşov, 500036 Braşov, Romania

Sustainability, 2021, vol. 13, issue 12, 1-23

Abstract: The current paper evaluates the impact of corruption and rent-seeking behaviors upon economic wealth in the European Union states using a public choice approach. The period of study is 2000 to 2019. To measure this impact, the present study uses a regression with variables reflecting governance quality and considered relevant, from a public choice approach, to corruption and rent-seeking. The main results of this study show a negative relationship between the level of corruption and economic wealth for all analyzed countries, especially for the ones that compose the new member states group. For all the EU member states, the variables capturing governance quality seem to have a positive impact on economic wealth. The higher levels of governance performance, synonymous with lower levels of rent-seeking, personal interest, and political pressures on state administrations, contribute to economic wealth, as public choice theory emphasizes. There is a need for reform and an increase in the efficiency of public institutions, especially in new member states.

Keywords: corruption; rent-seeking; economic wealth; public choice (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:13:y:2021:i:12:p:6870-:d:576925

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