Good for the goose, bad for the gander? Corruption and income inequality

Jamie Bologna Pavlik and Justin T. Callais

Southern Economic Journal, 2025, vol. 91, issue 3, 850-880

Abstract: We examine the relationship between corruption and income inequality across countries. While previous studies have explored this association at both an international and within‐country level, we expand on this literature in two distinct ways. First, along with the most commonly utilized measure of inequality (Gini coefficients), we also examine income per‐capita at each decile, along with top 1% and 5%, and the associated income shares. Second, we employ an empirical strategy that differs from the existing literature. Our primary results are estimated using matching methods, but we also supplement these results with a “doubly robust” difference‐in‐difference design. We find that a reduction in corruption increases incomes of the top 80% but does not significantly impact incomes of the bottom 20%, or the top 1% and 5%. We find some evidence of income growth amongst the top 1% and 5% following increases in corruption, but these results are inconsistent across estimations. Our results also suggest that accounting for the size of the informal sector matters a great deal in understanding the relationship between corruption and the distribution of income.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/soej.12733

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:soecon:v:91:y:2025:i:3:p:850-880

Access Statistics for this article

More articles in Southern Economic Journal from John Wiley & Sons
Bibliographic data for series maintained by Wiley Content Delivery ().