Decentralization (Localization) and Corruption : New Cross-Country Evidence

This paper attempts to improve the understanding and measurement of decentralization and its relationship with corruption in a worldwide context. This is done by presenting the conceptual underpinnings of such relationship as well as using superior...

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Main Authors: Ivanyna, Maksym, Shah, Anwar
Format: Policy Research Working Paper
Language:English
Published: 2012
Subjects:
CPI
TAX
Online Access:http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100510090347
http://hdl.handle.net/10986/3785
id okr-10986-3785
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic ABUSE
ACCOUNTABILITY
ACCOUNTABILITY IN GOVERNANCE
ACCOUNTING
ADMINISTRATIVE AUTONOMY
ADMINISTRATIVE DECENTRALIZATION
ASSETS
AUDITS
AVERAGE PERSON
BRIBE
BRIBERY
BRIBES
BUREAUCRACY
CAUSAL EFFECT
CENSORSHIP
CENTRAL AGENCIES
CENTRAL GOVERNMENT
CENTRAL GOVERNMENTS
CENTRAL INSTITUTIONS
CITIES
CITIZEN
CITIZEN PARTICIPATION
CITIZENS
COEFFICIENTS
COMPARATIVE ANALYSIS
CONFIDENCE
CONSOLIDATION
CONSTITUTION
CONSUMPTION NEEDS
CONTROLLING CORRUPTION
CORRUPTION
CORRUPTION PERCEPTION
CORRUPTION PERCEPTION INDEX
CORRUPTION PERCEPTIONS
CORRUPTION VARIABLE
CORRUPTION VARIABLES
COUNCILS
COUNTRY AVERAGE
COUNTRY COMPARISONS
COUNTRY DATA
COUNTRY EXPERTS
CPI
CRISES
DECENTRALIZATION
DECISION MAKING
DECISION MAKING PROCESS
DEMOCRACY
DEMOCRATIC INSTITUTIONS
DISCRETION
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC GROWTH
EMPLOYMENT
EXECUTIVE BODIES
EXPENDITURE
EXPENDITURE DECENTRALIZATION
EXPENDITURES
FEDERAL COUNTRIES
FEDERALISM
FISCAL DECENTRALIZATION
FISCAL DISCIPLINE
FISCAL FEDERALISM
FISCAL VARIABLES
GOOD GOVERNANCE
GOVERNMENT ACCOUNTABILITY
GOVERNMENT FINANCE
GOVERNMENT LEVEL
GOVERNMENT OFFICIAL
GOVERNMENT OFFICIALS
GOVERNOR
HEALTH SERVICES
INCOME
INFORMAL PAYMENT
INFORMAL PAYMENTS
INSTITUTIONAL ARRANGEMENTS
INTEGRITY
INVESTIGATIONS
INVESTMENT CLIMATE
LABOR MARKET
LEADERSHIP
LEGAL ORIGIN
LEGISLATION
LEGISLATIVE BODIES
LEGISLATIVE COUNCIL
LEGISLATURE
LOCAL ACCOUNTABILITY
LOCAL DECISION MAKING
LOCAL EXPENDITURES
LOCAL GOVERNANCE
LOCAL GOVERNMENT
LOCAL GOVERNMENTS
LOCAL TAXES
LOW INCOME COUNTRIES
MACROECONOMIC MANAGEMENT
MASS MEDIA
MAYOR
MEASUREMENT ERROR
MEASUREMENT ERRORS
MEDIA
MOTIVATIONS
MUNICIPAL SERVICES
MUNICIPALITIES
NATIONAL ACCOUNTS
NATIONS
PETTY CORRUPTION
POLICE
POLICE FORCES
POLITICAL ACCOUNTABILITY
POLITICAL AUTONOMY
POLITICAL DECENTRALIZATION
POLITICAL INSTITUTIONS
POLITICIANS
PRIVATE GAIN
PROBABILITY MODELS
PROVINCES
PUBLIC ECONOMICS
PUBLIC EMPLOYEES
PUBLIC ENTITY
PUBLIC FINANCE
PUBLIC GOVERNANCE
PUBLIC HEALTH
PUBLIC HEARINGS
PUBLIC OFFICIALS
PUBLIC SECTOR
REFERENDUM
REFERENDUMS
REMEDY
REPRESENTATIVES
REVOLUTION
SERVICE DELIVERY
SOCIAL JUSTICE
SOCIAL SECURITY
STATE GOVERNMENT
STATE GOVERNMENTS
STATISTICAL ESTIMATION
SUB-NATIONAL
SUB-NATIONAL EXPENDITURE
SUB-NATIONAL UNITS
SUBNATIONAL
SUBNATIONAL GOVERNMENTS
TAX
TAX DECENTRALIZATION
TAX INSPECTIONS
TAX REVENUES
TAX SHARING
TAXATION
THEFT
TRANSACTION COSTS
TRANSPARENCY
spellingShingle ABUSE
ACCOUNTABILITY
ACCOUNTABILITY IN GOVERNANCE
ACCOUNTING
ADMINISTRATIVE AUTONOMY
ADMINISTRATIVE DECENTRALIZATION
ASSETS
AUDITS
AVERAGE PERSON
BRIBE
BRIBERY
BRIBES
BUREAUCRACY
CAUSAL EFFECT
CENSORSHIP
CENTRAL AGENCIES
CENTRAL GOVERNMENT
CENTRAL GOVERNMENTS
CENTRAL INSTITUTIONS
CITIES
CITIZEN
CITIZEN PARTICIPATION
CITIZENS
COEFFICIENTS
COMPARATIVE ANALYSIS
CONFIDENCE
CONSOLIDATION
CONSTITUTION
CONSUMPTION NEEDS
CONTROLLING CORRUPTION
CORRUPTION
CORRUPTION PERCEPTION
CORRUPTION PERCEPTION INDEX
CORRUPTION PERCEPTIONS
CORRUPTION VARIABLE
CORRUPTION VARIABLES
COUNCILS
COUNTRY AVERAGE
COUNTRY COMPARISONS
COUNTRY DATA
COUNTRY EXPERTS
CPI
CRISES
DECENTRALIZATION
DECISION MAKING
DECISION MAKING PROCESS
DEMOCRACY
DEMOCRATIC INSTITUTIONS
DISCRETION
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC GROWTH
EMPLOYMENT
EXECUTIVE BODIES
EXPENDITURE
EXPENDITURE DECENTRALIZATION
EXPENDITURES
FEDERAL COUNTRIES
FEDERALISM
FISCAL DECENTRALIZATION
FISCAL DISCIPLINE
FISCAL FEDERALISM
FISCAL VARIABLES
GOOD GOVERNANCE
GOVERNMENT ACCOUNTABILITY
GOVERNMENT FINANCE
GOVERNMENT LEVEL
GOVERNMENT OFFICIAL
GOVERNMENT OFFICIALS
GOVERNOR
HEALTH SERVICES
INCOME
INFORMAL PAYMENT
INFORMAL PAYMENTS
INSTITUTIONAL ARRANGEMENTS
INTEGRITY
INVESTIGATIONS
INVESTMENT CLIMATE
LABOR MARKET
LEADERSHIP
LEGAL ORIGIN
LEGISLATION
LEGISLATIVE BODIES
LEGISLATIVE COUNCIL
LEGISLATURE
LOCAL ACCOUNTABILITY
LOCAL DECISION MAKING
LOCAL EXPENDITURES
LOCAL GOVERNANCE
LOCAL GOVERNMENT
LOCAL GOVERNMENTS
LOCAL TAXES
LOW INCOME COUNTRIES
MACROECONOMIC MANAGEMENT
MASS MEDIA
MAYOR
MEASUREMENT ERROR
MEASUREMENT ERRORS
MEDIA
MOTIVATIONS
MUNICIPAL SERVICES
MUNICIPALITIES
NATIONAL ACCOUNTS
NATIONS
PETTY CORRUPTION
POLICE
POLICE FORCES
POLITICAL ACCOUNTABILITY
POLITICAL AUTONOMY
POLITICAL DECENTRALIZATION
POLITICAL INSTITUTIONS
POLITICIANS
PRIVATE GAIN
PROBABILITY MODELS
PROVINCES
PUBLIC ECONOMICS
PUBLIC EMPLOYEES
PUBLIC ENTITY
PUBLIC FINANCE
PUBLIC GOVERNANCE
PUBLIC HEALTH
PUBLIC HEARINGS
PUBLIC OFFICIALS
PUBLIC SECTOR
REFERENDUM
REFERENDUMS
REMEDY
REPRESENTATIVES
REVOLUTION
SERVICE DELIVERY
SOCIAL JUSTICE
SOCIAL SECURITY
STATE GOVERNMENT
STATE GOVERNMENTS
STATISTICAL ESTIMATION
SUB-NATIONAL
SUB-NATIONAL EXPENDITURE
SUB-NATIONAL UNITS
SUBNATIONAL
SUBNATIONAL GOVERNMENTS
TAX
TAX DECENTRALIZATION
TAX INSPECTIONS
TAX REVENUES
TAX SHARING
TAXATION
THEFT
TRANSACTION COSTS
TRANSPARENCY
Ivanyna, Maksym
Shah, Anwar
Decentralization (Localization) and Corruption : New Cross-Country Evidence
geographic_facet The World Region
The World Region
relation Policy Research working paper ; no. WPS 5299
description This paper attempts to improve the understanding and measurement of decentralization and its relationship with corruption in a worldwide context. This is done by presenting the conceptual underpinnings of such relationship as well as using superior and more defensible measures of both decentralization in its various dimensions as well as corruption for a sample of 182 countries. It is the first paper that treats various tiers of local governments (below the inter-mediate order of government) as the unit of comparative analysis. In contrast, previous analyses erroneously focused on subnational governments as the unit of analysis which yields invalid cross-country comparisons. By pursuing rigorous econometric analysis, the paper demonstrates that decentralization, when properly measured to mean moving government closer to people by empowering local governments, is shown to have significant negative effect on the incidence of corruption regardless of the choice of the estimation procedures or the measures of corruption used. In terms of various dimensions of decentralized local governance, political decentralization matters even when we control for fiscal decentralization. Further voice (political accountability) is empirically shown to be more important in combating corruption than exit options made available through competition among jurisdictions.
format Publications & Research :: Policy Research Working Paper
author Ivanyna, Maksym
Shah, Anwar
author_facet Ivanyna, Maksym
Shah, Anwar
author_sort Ivanyna, Maksym
title Decentralization (Localization) and Corruption : New Cross-Country Evidence
title_short Decentralization (Localization) and Corruption : New Cross-Country Evidence
title_full Decentralization (Localization) and Corruption : New Cross-Country Evidence
title_fullStr Decentralization (Localization) and Corruption : New Cross-Country Evidence
title_full_unstemmed Decentralization (Localization) and Corruption : New Cross-Country Evidence
title_sort decentralization (localization) and corruption : new cross-country evidence
publishDate 2012
url http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100510090347
http://hdl.handle.net/10986/3785
_version_ 1764388336597729280
spelling okr-10986-37852021-04-23T14:02:12Z Decentralization (Localization) and Corruption : New Cross-Country Evidence Ivanyna, Maksym Shah, Anwar ABUSE ACCOUNTABILITY ACCOUNTABILITY IN GOVERNANCE ACCOUNTING ADMINISTRATIVE AUTONOMY ADMINISTRATIVE DECENTRALIZATION ASSETS AUDITS AVERAGE PERSON BRIBE BRIBERY BRIBES BUREAUCRACY CAUSAL EFFECT CENSORSHIP CENTRAL AGENCIES CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CENTRAL INSTITUTIONS CITIES CITIZEN CITIZEN PARTICIPATION CITIZENS COEFFICIENTS COMPARATIVE ANALYSIS CONFIDENCE CONSOLIDATION CONSTITUTION CONSUMPTION NEEDS CONTROLLING CORRUPTION CORRUPTION CORRUPTION PERCEPTION CORRUPTION PERCEPTION INDEX CORRUPTION PERCEPTIONS CORRUPTION VARIABLE CORRUPTION VARIABLES COUNCILS COUNTRY AVERAGE COUNTRY COMPARISONS COUNTRY DATA COUNTRY EXPERTS CPI CRISES DECENTRALIZATION DECISION MAKING DECISION MAKING PROCESS DEMOCRACY DEMOCRATIC INSTITUTIONS DISCRETION ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC GROWTH EMPLOYMENT EXECUTIVE BODIES EXPENDITURE EXPENDITURE DECENTRALIZATION EXPENDITURES FEDERAL COUNTRIES FEDERALISM FISCAL DECENTRALIZATION FISCAL DISCIPLINE FISCAL FEDERALISM FISCAL VARIABLES GOOD GOVERNANCE GOVERNMENT ACCOUNTABILITY GOVERNMENT FINANCE GOVERNMENT LEVEL GOVERNMENT OFFICIAL GOVERNMENT OFFICIALS GOVERNOR HEALTH SERVICES INCOME INFORMAL PAYMENT INFORMAL PAYMENTS INSTITUTIONAL ARRANGEMENTS INTEGRITY INVESTIGATIONS INVESTMENT CLIMATE LABOR MARKET LEADERSHIP LEGAL ORIGIN LEGISLATION LEGISLATIVE BODIES LEGISLATIVE COUNCIL LEGISLATURE LOCAL ACCOUNTABILITY LOCAL DECISION MAKING LOCAL EXPENDITURES LOCAL GOVERNANCE LOCAL GOVERNMENT LOCAL GOVERNMENTS LOCAL TAXES LOW INCOME COUNTRIES MACROECONOMIC MANAGEMENT MASS MEDIA MAYOR MEASUREMENT ERROR MEASUREMENT ERRORS MEDIA MOTIVATIONS MUNICIPAL SERVICES MUNICIPALITIES NATIONAL ACCOUNTS NATIONS PETTY CORRUPTION POLICE POLICE FORCES POLITICAL ACCOUNTABILITY POLITICAL AUTONOMY POLITICAL DECENTRALIZATION POLITICAL INSTITUTIONS POLITICIANS PRIVATE GAIN PROBABILITY MODELS PROVINCES PUBLIC ECONOMICS PUBLIC EMPLOYEES PUBLIC ENTITY PUBLIC FINANCE PUBLIC GOVERNANCE PUBLIC HEALTH PUBLIC HEARINGS PUBLIC OFFICIALS PUBLIC SECTOR REFERENDUM REFERENDUMS REMEDY REPRESENTATIVES REVOLUTION SERVICE DELIVERY SOCIAL JUSTICE SOCIAL SECURITY STATE GOVERNMENT STATE GOVERNMENTS STATISTICAL ESTIMATION SUB-NATIONAL SUB-NATIONAL EXPENDITURE SUB-NATIONAL UNITS SUBNATIONAL SUBNATIONAL GOVERNMENTS TAX TAX DECENTRALIZATION TAX INSPECTIONS TAX REVENUES TAX SHARING TAXATION THEFT TRANSACTION COSTS TRANSPARENCY This paper attempts to improve the understanding and measurement of decentralization and its relationship with corruption in a worldwide context. This is done by presenting the conceptual underpinnings of such relationship as well as using superior and more defensible measures of both decentralization in its various dimensions as well as corruption for a sample of 182 countries. It is the first paper that treats various tiers of local governments (below the inter-mediate order of government) as the unit of comparative analysis. In contrast, previous analyses erroneously focused on subnational governments as the unit of analysis which yields invalid cross-country comparisons. By pursuing rigorous econometric analysis, the paper demonstrates that decentralization, when properly measured to mean moving government closer to people by empowering local governments, is shown to have significant negative effect on the incidence of corruption regardless of the choice of the estimation procedures or the measures of corruption used. In terms of various dimensions of decentralized local governance, political decentralization matters even when we control for fiscal decentralization. Further voice (political accountability) is empirically shown to be more important in combating corruption than exit options made available through competition among jurisdictions. 2012-03-19T18:39:46Z 2012-03-19T18:39:46Z 2010-05-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100510090347 http://hdl.handle.net/10986/3785 English Policy Research working paper ; no. WPS 5299 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region