Live free or bribe: On the causal dynamics between economic freedom and corruption in U.S. states
Journal article
| Authors | Apergis, Nicholas, Dincer, Oguzhan and Payne, James |
|---|---|
| Abstract | We investigate the relationship between economic freedom and corruption using data from U.S. states covering almost a quarter of a century. Our study advances the existing literature on several fronts. First, instead of using subjective cross-country corruption indices assembled by various investment risk services, we use a more objective measure of corruption: the number of government officials convicted in a state for crimes related to corruption. Second, unlike previous studies, we exploit both time series and cross-sectional variation in the data in the estimation of a panel error correction model. The panel error correction model results show that in the long-run economic freedom, per capita income, and education have a negative and statistically significant impact on corruption whereas income inequality has a positive and statistically significant impact. The causality tests associated with the panel error correction model reveal bidirectional causality between economic freedom and corruption in both the short-run and long-run. |
| Keywords | Economic freedom; Corruption; Panel error correction model |
| Year | 2012 |
| Journal | European Journal of Political Economy |
| Publisher | Elsevier |
| Web address (URL) | http://hdl.handle.net/10545/623594 |
| http://creativecommons.org/licenses/by-nc-nd/4.0/ | |
| hdl:10545/623594 | |
| Publication dates | Jun 2012 |
| Publication process dates | |
| Deposited | 14 Mar 2019, 17:40 |
| Contributors | University of Piraeus, Illinois State University and University of South Florida Polytechnic |
| File | File Access Level Open |
| File | File Access Level Open |
https://repository.derby.ac.uk/item/9355z/live-free-or-bribe-on-the-causal-dynamics-between-economic-freedom-and-corruption-in-u-s-states
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