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http://hdl.handle.net/10419/55027
  
Title:Between two evils: Investors prefer grand corruption! PDF Logo
Authors:Graf Lambsdorff, Johann
Issue Date:2005
Series/Report no.:Passauer Diskussionspapiere: Volkswirtschaftliche Reihe V-31-05
Abstract:Recent empirical studies claim that, in addition to levels of corruption, investors are deterred by its unpredictability. I claim instead that it is petty corruption that deters investors. I employ seven subcomponents of corruption for a sample of 102 countries that appear in the 2003 Global Competitiveness Report of the WEF. The second principal component of this data depicts a grand, political type, embracing corruption in government policymaking and in judicial decisions as opposed to corruption in public utilities and loan applications. Grand corruption less deters investors because they might feel belonging to an inner circle of insiders that can profit from hidden arrangements. Grand corruption also entails relatively smaller organizational effort.
Subjects:Grand Corruption
Petty Corruption
Extortion
Predictability
Opportunism
Public Utilities
Laws and Policies
Judiciary
JEL:C21
F21
O17
K42
Document Type:Working Paper
Appears in Collections:Passauer Diskussionspapiere, Volkswirtschaftliche Reihe, Universität Passau

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