Corruption, Structural Reforms, and Economic Performance in the Transition Economies

Author/Editor:

George T. Abed ; Hamid R Davoodi

Publication Date:

July 1, 2000

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Recent studies have highlighted the adverse impact of corruption on economic performance. This paper advances the hypothesis that corruption is largely a symptom of underlying weaknesses in public policies and institutions, a formulation that provides deeper insights into economic performance than do measures of “perceived corruption.” The hypothesis is tested by assessing the relative importance of structural reforms vs. corruption in explaining macroeconomic performance in the transition economies. The paper finds that for four widely used measures of economic performance—growth, inflation, the fiscal balance, and foreign direct investment—structural reforms tend to dominate the corruption variable.

Series:

Working Paper No. 2000/132

Subject:

Balance of payments Corruption Crime Exchange rate arrangements Fiscal policy Fiscal stance Foreign direct investment Foreign exchange Macrostructural analysis Structural reforms

English

Publication Date:

July 1, 2000

ISBN/ISSN:

9781451855371/1018-5941

Stock No:

WPIEA1322000

Pages:

47

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