Abstract
This paper presents an analysis of bureaucratic corruption, income inequality and economic development. The analysis is based on a dynamic general equilibrium model in which bureaucrats are appointed by the government to implement a redistributive programme of taxes and subsidies designed to benefit the poor. Corruption is reflected in bribery and tax evasion as bureaucrats conspire with the rich in providing false information to the government. In accordance with empirical evidence, the model predicts a positive relationship between corruption and inequality, and a negative relationship between corruption and development.
| Original language | English |
|---|---|
| Pages (from-to) | 1534-1563 |
| Number of pages | 30 |
| Journal | European Economic Review |
| Volume | 51 |
| Issue number | 6 |
| Early online date | 20 Dec 2006 |
| DOIs | |
| Publication status | Published - Aug 2007 |
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Blackburn, K., & Forgues-Puccio, G. (2007). Distribution and development in a model of misgovernance. European Economic Review, 51(6), 1534-1563. https://doi.org/10.1016/j.euroecorev.2006.10.003