Corruption, decentralization and yardstick competition |
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Authors: | Oguzhan C. Dincer Christopher J. Ellis Glen R. Waddell |
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Affiliation: | 1. Department of Economics, Illinois State University, Normal, IL, 61790-4200, USA 2. Department of Economics, University of Oregon, Eugene, OR, 97403-1285, USA
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Abstract: | Several empirical studies have found a negative relationship between corruption and the decentralization of the powers to tax and spend. In this paper we explain this phenomenon using a model of Yardstick Competition. Using data on federal corruption-related convictions in U.S. states, we also provide new evidence that points to the existence of a spatial autoregressive component to explaining corruption. We interpret this as consistent with the theoretical findings. |
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