Corruption, Structural Reforms, and Economic Performance in the Transition Economies
July 1, 2000
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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.
Subject: Balance of payments, Corruption, Crime, Exchange rate arrangements, Fiscal policy, Fiscal stance, Foreign direct investment, Foreign exchange, Macrostructural analysis, Structural reforms
Keywords: Corruption, exchange rate, Exchange rate arrangements, Fiscal stance, Foreign direct investment, GDP growth, inflation rate, priori country classification, reform index, reforming country, structural reform, structural reforms, transition economies, transition economy, wage inflation, WP
Pages:
47
Volume:
2000
DOI:
Issue:
132
Series:
Working Paper No. 2000/132
Stock No:
WPIEA1322000
ISBN:
9781451855371
ISSN:
1018-5941
