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dc.contributor.authorApergis, Nicholas
dc.contributor.authorDincer, O.
dc.contributor.authorPayne, J.
dc.identifier.citationApergis, Nicholas and Dincer, Oguzhan C. and Payne, James E. 2012. Live Free Or Bribe: On The Causal Dynamics Between Economic Freedom and Corruption in U.S. States. European Journal of Political Economy. 28 (2): pp. 215-226.

We investigate the relationship between economic freedom and corruption using data from U.S. states covering almost a quarter of a century. Our study advances the existing literature on several fronts. First, instead of using subjective cross-country corruption indices assembled by various investment risk services, we use a more objective measure of corruption: the number of government officials convicted in a state for crimes related to corruption. Second, unlike previous studies, we exploit both time series and cross-sectional variation in the data in the estimation of a panel error correction model. The panel error correction model results show that in the long-run economic freedom, per capita income, and education have a negative and statistically significant impact on corruption whereas income inequality has a positive and statistically significant impact. The causality tests associated with the panel error correction model reveal bidirectional causality between economic freedom and corruption in both the short-run and long-run.

dc.publisherElsevier BV * North-Holland
dc.subjectEconomic freedom
dc.subjectPanel error correction model
dc.titleLive Free Or Bribe: On The Causal Dynamics Between Economic Freedom and Corruption in U.S. States
dc.typeJournal Article
dcterms.source.titleEuropean Journal of Political Economy
curtin.accessStatusFulltext not available

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