JSPES, Vol. 26, No. 4 (Winter 2001 )
pp. 671-681

Business as Usual: Corruption and Business Activity

Elia Kacapyr

A regression analysis is used to verify the determinants of corruption. Using a cross-sectional data set of 48 countries, a significant relationship between GDP per capita and the level of corruption is confirmed. However, it is likely that GDP per capita is a determinant of corruption and affected by corruption. An instrumental variable technique is used to help determine the true impact of GDP per capita on corruption.