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Distribution and Development in a Model of Misgovernance

1st Person: Blackburn, Keith
Additional Persons: Forgues-Puccio, Gonzalo F.
Type of Publication: Paper
Language: English
Published: 2005
Series: Proceedings of the German Development Economics Conference, Kiel 2005 / Verein für Socialpolitik, Research Committee Development Economics
Online: https://www.econstor.eu/bitstream/10419/19808/1/Furgues_Puccio.pdf
Description: 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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