Distribution and development in a model of misgovernance

Keith Blackburn; Gonzalo Forgues-Puccio

doi:10.1016/j.euroecorev.2006.10.003

Distribution and development in a model of misgovernance

Keith Blackburn, Gonzalo Forgues-Puccio

BLS

Research output: Contribution to journal › Article › peer-review

31 Citations (Scopus)

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	https://doi.org/10.1016/j.euroecorev.2006.10.003
Publication status	Published - Aug 2007

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AB - 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.

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