Does inequality foster corruption?

I Dutta, Ajit Mishra

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We investigate how inequality affects corruption and provide a new insight to the possible channels through which such effect may work. We favour an explanation based on a multi-market framework where corruption in one market (or sector) arises because of imperfections exacerbated by inequality in related markets. We demonstrate that even when an individual's ability to pay bribes and benefit from engaging in corruption are not affected by wealth level, greater (wealth) inequality will lead to an increase in corruption.
Original languageEnglish
Pages (from-to)602-619
JournalJournal of Public Economic Theory
Issue number4
Early online date13 Mar 2013
Publication statusPublished - Aug 2013

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