Does Corruption Affect Income Inequality and Poverty?

Sanjeev Gupta

No 1998/076, IMF Working Papers from International Monetary Fund

Abstract: This paper demonstrates that high and rising corruption increases income inequality and poverty by reducing economic growth, the progressivity of the tax system, the level and effectiveness of social spending, and the formation of human capital, and by perpetuating an unequal distribution of asset ownership and unequal access to education. These findings hold for countries with different growth experiences, at different stages of development, and using various indices of corruption. An important implication of these results is that policies that reduce corruption will also lower income inequality and poverty.

Keywords: WP; income growth; corruption index; inequality regression; growth of the poor; Corruption; income inequality; poverty; income-generating assets; income inequality regression; social spending; limit poverty reduction; Income distribution; Personal income (search for similar items in EconPapers)
Pages: 41
Date: 1998-05-01
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Citations: View citations in EconPapers (150)

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Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1998/076

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