Corruption Reexamined

Abstract

This paper looks at the validity of a conventional hypothesis about corruption on the basis of new data. The basic import of this hypothesis is that corruption should decline with economic development. The data seem to indicate that important qualifications need to be made about this hypothesis. Moreover, a theory formed on the basis of an empirically proven and theoretically plausible positive association between product variety and economic development and standard demand analysis seems to indicate that the generality of this hypothesis is in considerable doubt.