Economics of Governance

, Volume 15, Issue 1, pp 51–69 | Cite as

Corruption, regulation, and growth: an empirical study of the United States

  • Noel D. Johnson
  • William Ruger
  • Jason Sorens
  • Steven Yamarik
Original Paper

Abstract

This paper investigates whether the costs of corruption are conditional on the extent of government intervention in the economy. We use data on corruption convictions and economic growth between 1975 and 2007 across the US states to test this hypothesis. Although no state approaches the level of government intervention found in many developing countries, we still find evidence for the “weak” form of the grease-the-wheels hypothesis. While corruption is never good for growth, its harmful effects are smaller in states with more regulation.

Keywords

Corruption US states Growth Regulation 

JEL classifications

K4 O1 H7 H0 D7 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  • Noel D. Johnson
    • 1
  • William Ruger
    • 2
  • Jason Sorens
    • 3
  • Steven Yamarik
    • 4
  1. 1.Department of EconomicsGeorge Mason UniversityFairfaxUSA
  2. 2.Department of Political ScienceTexas State UniversitySan MarcosUSA
  3. 3.Department of GovernmentDartmouth CollegeHanoverUSA
  4. 4.Department of EconomicsCalifornia State UniversityLong BeachUSA

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