Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/72568 
Year of Publication: 
2013
Series/Report no.: 
CESifo Working Paper No. 4212
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We claim that a sequential mechanism linking history to development exists: first, history defines the quality of social capital; then, social capital determines the level of corruption; finally, corruption affects economic performance. We test this hypothesis on a dataset of Italian provinces, and address the possible endogeneity of corruption by applying an IV model. We use three sets of historical instruments for corruption: 1) foreign dominations in 16th-17th century, 2) autocracy/autonomous rule in the 14th century, and 3) an index of social capital between in the 19th-20th century. The results indicate a significant impact of historically-driven corruption on development.
Subjects: 
corruption
economic development
institutions
social capital
history
JEL: 
D73
O12
O43
C26
Document Type: 
Working Paper
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