Corruption, development, and the environment

The book analyses the influence of corruption on economic growth and environmental protection, examining corruption from different perspectives. It contributes to several streams of the literature and assembles evidence of the influence of corruption on two important variables in human welfare: income and environmental policies. The material evinces the detrimental effect that corruption has on economic growth and on the stringency of environmental policies. It also shows that standard techniques for fighting corruption are often based either on simplistic definitions or on strong assumptions that do not apply in many countries blighted by corruption. From a methodological standpoint, this work combines a number of approaches including a theoretical discussion of corruption and of its definition (often omitted in economic studies), together with econometrics, case studies and policy discussions. Cover 1 Corruption, Development and the Environment 2 Corruption, Development and the Environment 3 ISBN 9789400705982 4 Acknowledgements 6 Contents 8 List of Figures 12 List of Tables 14 Introduction 16 1.1 Background 16 1.2 Economics of Corruption 18 1.2.1 Corruption and the Environment 20 1.3 Research Questions and Outline 21 References 25 Economic Analysis of Corruption 28 2.1 Introduction 28 2.2 The Definition of Corruption 29 2.3 Corruption and the Private Sector 34 2.3.1 Perceptions of Corruption 35 2.3.2 Opportunities for Corruption and Anti-corruption Strategies 36 2.3.3 Corruption and Market Failures 38 2.4 The Measurement of Corruption 39 2.5 Discussion 40 References 41 Causes of Corruption: A Survey of Cross-Country Analyses and Extended Results 44 3.1 Introduction 44 3.2 Theories of Determinants of Corruption 48 3.2.1 Historical Roots of Corruption 49 3.2.2 Contemporary Causes of Corruption 50 3.3 Data Sources on Corruption 52 3.4 Empirical Analysis 53 3.5 Limits and Interpretation of Econometric Cross-Country Analysis 60 3.6 Discussion and Conclusions 62 Appendix 63 References 64 The Effect of Corruption on Growth and Its Transmission Channels 68 4.1 Introduction 68 4.2 Cross-Country Growth Regressions 72 4.3 Transmission Channels for Corruption 75 4.3.1 The Investment Transmission Channel 76 4.3.2 The Schooling Transmission Channel 77 4.3.3 The Trade Openness Transmission Channel 77 4.3.4 The Political Violence Transmission Channel 78 4.4 Direct and Indirect Effects of Corruption 78 4.5 The Long-Term Effect of Corruption on the Transmission Variables 80 4.6 Conclusions 82 Appendix 1: Long-Term Income Effects 83 Appendix 2: Robustness Checks 84 Appendix 3: Data 87 References 88 Corruption, Democracy, and Environmental Policy: An Empirical Contribution to the Debate 90 5.1 Introduction 90 5.2 Theoretical Hypotheses and Their Empirical Testing 92 5.2.1 Democracy and the Environment 92 5.2.2 Corruption and the Environment 94 5.2.3 Institutions and the Environment 95 5.3 The Data 97 5.4 Empirical Results 100 5.4.1 The Case for Interaction Between Democracy and Income Variables 105 5.5 Implications for the Environmental Kuznets Curve 107 5.6 Conclusions 109 Appendix 1 110 Appendix 2: Data 111 References 111 Corruption and Environmental Policies: What Are the Implications for the Enlarged EU? 116 6.1 Introduction 116 6.2 Determinants of Environmental Policy Stringency 120 6.2.1 Cross-Country Evidence 121 6.3 Environmental Policies and Institutions in the EU 126 6.3.1 The Accession Process and Its Review: Focus on Corruption 126 6.3.2 New and Old Member States of the EU: Environmental Policies and Corruption Levels 128 6.4 Conclusions 130 Appendix: Data 131 References 133 The Rule of the Jungle in Pakistan: A Case Study on Corruption and Forest Management in Swat 136 7.1 Introduction 137 7.2 Institutions and Forest Management 139 7.2.1 Corruption and Forestry 139 7.2.1.1 Overview of Corruption and Forestry 140 7.2.1.2 Evidence on the Extent of Corruption in Pakistan 141 7.2.2 Methodological Framework 142 7.3 A Profile of Swat, Pakistan 144 7.3.1 Geography and Ecology 144 7.3.2 History and Institutions 145 7.3.2.1 Pre-accession 145 7.3.2.2 Post-accession 145 7.4 Alternative Forest Management Regimes in Swat 147 7.5 Deforestation in Swat, Pakistan 148 7.5.1 Incentives and Institutions over the Forests of Swat: Focus on Corruption 149 7.6 Strategies for Institutional Change 151 7.6.1 The Reform Process of the Early 2000s 152 7.6.2 Institutional Reforms 154 7.6.3 Paths of Change 155 7.6.3.1 Actors and Incentives 155 7.6.3.2 Auxiliary Initiatives and Federal-Level Reforms 158 7.7 Conclusions 159 Appendix: Sources of Information in the Study 160 References 160 Conclusions and Future Research 164 8.1 Main Conclusions 164 8.2 Policy Conclusions 166 8.3 Future Research 168 References 171 Author Index 172 Subject Index 174 9400705980,9789400705982 Springer 2011 Front Matter....Pages 1-1 Introduction....Pages 1-11 Economic Analysis of Corruption....Pages 13-27 Causes of Corruption: A Survey of Cross-Country Analyses and Extended Results....Pages 29-51 The Effect of Corruption on Growth and Its Transmission Channels....Pages 53-74 Corruption, Democracy, Democracy and Environmental Policy: An Empirical Contribution to the Debate....Pages 75-99 Corruption and Environmental Policies: What Are the Implications for the Enlarged EU?....Pages 101-119 The Rule of the Jungle in Pakistan: A Case Study on Corruption and Forest Management in Swat Swat ....Pages 121-147 Conclusions and Future Research....Pages 149-156 Back Matter....Pages 152-152