Corruption: Transcending Borders

E.A. Correa, Michael Jetter, A.M. Agudelo

Research output: Contribution to journalArticlepeer-review

8 Citations (Scopus)


© 2016 John Wiley & Sons Ltd. Is corrupt behavior transmitted internationally? Using panel data for 123 countries from 1995 to 2012, our results suggest a positive and statistically meaningful relationship between neighboring countries' corruption levels and domestic graft. This result is robust to including two-way fixed effects, country-specific time trends, and the standard set of control variables. The effect becomes stronger as income increases, if capital cities are located closer to each other, and if countries share a common political union, such as the European Union. We find less evidence for common language or comparable institutional backgrounds (e.g., similar degrees of democracy), but some evidence for trade relationships as potential transmission channels. These findings allow two main conclusions. First, a country with corrupt neighbors will find it difficult to get rid of corruption. Second, on a more positive note, efforts aimed at decreasing domestic corruption levels could produce positive externalities in affecting neighboring countries. This could particularly hold true within a common institutional framework, such as the European Union.
Original languageEnglish
Pages (from-to)183-207
Number of pages25
Issue number2
Publication statusPublished - 1 May 2016


Dive into the research topics of 'Corruption: Transcending Borders'. Together they form a unique fingerprint.

Cite this