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Relationships between corruption, political orientation, and income inequality: evidence from Latin America

Luis Pedauga, Lucien David Pedauga and Blanca L. Delgado-Márquez

Applied Economics, 2017, vol. 49, issue 17, 1689-1705

Abstract: This research sheds light on the analysis of the impact of corruption and political orientation on income distribution in Latin America. Although it has been theoretically demonstrated that corruption worsens the income distribution, the empirical evidence has yielded ambiguous results based on biased estimates not considering a measurement error in the estimation of inequality. This article fills this gap by correcting the previous measurement error bias in the fixed-effects estimation. Additionally, political orientation and its relationship with income inequality are also investigated. The sample covers 18 Latin American countries between 1996 and 2012. Results reveal that corruption increases income inequality.

Date: 2017
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Citations: View citations in EconPapers (6)

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DOI: 10.1080/00036846.2016.1223830

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