Corruption and Political Competition

Richard Damania and Erkan Yalcýn

No 2008-7, Economics Discussion Papers from Kiel Institute for the World Economy

Abstract: There is a growing evidence that political corruption is often closely associated with the rent seeking activities of special interest groups. This paper examines the nature of the interaction between the lobbying activities of special interest groups and the incidence of political corruption and determines whether electoral competition can eliminate political corruption. We obtain some striking results. Greater electoral competition serves to lessen policy distortions. However, this in turn stimulates more intense lobbying which increases the scope of corrupt behavior. It is shown that electoral competition merely serves to alter the type of corruption that eventuates, but cannot eliminate it.

Keywords: Corruption; lobbying; political competition (search for similar items in EconPapers)
JEL-codes: D72 D73 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-pol and nep-reg
Date: 2008

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Persistent link: http://EconPapers.repec.org/RePEc:zbw:ifwedp:7128

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