Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/30501
Authors: 
Lessmann, Christian
Markwardt, Gunther
Year of Publication: 
2009
Series/Report no.: 
CESifo Working Paper 2662
Abstract: 
The majority of theoretical and empirical studies on the relationship between decentralization and corruption argues that the devolution of power might be a feasible instrument to keep corruption at bay. We argue that this result crucially depends on the effectiveness of monitoring bureaucrat's behavior. The benefits of interjurisdictional competition only occur if there is a supervisory body such as a free press, which is often lacking in less-developed countries. Using cross-country data, we analyze the relationship between decentralization and corruption taking different degrees of the freedom of the press into account. Our main finding is that decentralization counteracts corruption in countries with high degrees of press freedom, whereas countries without effective monitoring suffer from decentralization. Our policy implication is that a free press is a necessary pre-condition for successful decentralization programs.
Subjects: 
decentralization
corruption
freedom of press
JEL: 
D73
H77
O23
Document Type: 
Working Paper

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