Corruption, democracy, inequality and economic growth: Exploring the theoretical and empirical relationship in South America, 1995-2008.

摘要

South America has been plagued with corruption scandals in the past and today. Just mentioning Carlos Menem, Abdala Bucaram or Alberto Fujimori brings back memories of political and economic instability, concentration of political power, lack of accountability and civil unrest.;In this sense, some papers have argued that South America has lost almost one third of its GDP per capita between 1995 and 2008 due to corruption, suggesting that improving transparency and probity is crucial for achieving development.;This dissertation analyzes the theoretical and empirical relationship between corruption, inequality and economic growth in South America. In this region, democracy has a prominent role in deterring corruption. By providing a theoretical framework relating democracy, equality, GDP per capita and women's participation in government, this dissertation finds empirical evidence that these variables have a positive effect on transparency.;Furthermore, an analysis of citizen participation laws shows that citizen oversight may prove significant in combating corruption. In contrast, ethics codes for the public service have at most a mild effect on transparency.;In order to provide robust results, this dissertation's methodological approach controls for: simultaneity and endogeneity of corruption, growth and inequality; spatial autocorrelation; grouping effects; and, unobserved and omitted factors.;In particular, this dissertation suggests that equality, GDP per capita, democracy and participation of women in government promote transparency and provides evidence that citizen participation laws, as a form of promoting democracy, encourage probity in South America.;Additionally, this study suggests that some South American countries such as Uruguay and Chile have advanced faster in fostering transparency due to higher levels of equality, GDP per capita (income) and democracy.;Finally, the results provide evidence favoring the "sands the wheels" theory meaning that corruption discourages development and growth yet promoting citizen participation laws, equality and democracy would foster transparency and economic progress.