This paper analyzes the influence of the shadow economy on corruption and vice versa. We hypothesize that corruption and shadow economy are substitutes in high income countries while they are complements in low income countries. The hypotheses are tested for a cross-section of 120 countries and...

This paper surveys some recent literature on fiscal policy and comparative politics. Economic policy is viewed as the outcome of a game with multiple-principals and multiple-agents. Opportunistic politicians bargain over policy. Rational voters hold them accountable through retrospective voting....

A new line of theoretical and empirical literature emphasizes the pivotal role of fair institutions for growth. We present a model, a laboratory experiment, and a simple cross-country regression supporting this view. We model an economy with an unequal distribution of property rights, in which...

During the last decade unicameral proposals have been put forward in fourteen US states. In this paper we propose a theoretical framework casting some lights on the drawbacks of bicameral state legislatures and on the effects of the proposed constitutional reforms. In a setting where lawmakers...

The majority of theoretical and empirical studies on the relationship between decentralization and corruption argues that the devolution of power might be a feasible instrument to keep corruption at bay. We argue that this result crucially depends on the effectiveness of monitoring...

A demographic transition resulting from an increase in the size of the young working age population can be a blessing or a curse for economic performance. We focus on the political stability effects of a larger youth population and hypothesize that corruption matters in this nexus. Using panel...

Large-scale land acquisitions often take place in developing countries which are also known for their corruption-friendliness caused by weak institutional frameworks. We hypothesize that corruption indeed leads to more land deals. We argue that corrupt elites exploit poor institutional setups...

In many cultures and industries gifts are given in order to influence the recipient, often at the expense of a third party. Examples include business gifts of firms and lobbyists. In a series of experiments, we show that, even without incentive or informational effects, small gifts strongly...

We examine whether a corruption scandal in which the incumbent is implicated undermines trust in local government. We use a novel dataset containing information on local corruption scandals reported in Spain during the period 1999-2009, and data on the level of trust expressed in local...

Legal provisions that protect politicians from arrest and prosecution exist throughout much of the modern democratic world. Why, and with what effects, do societies choose to place their politicians above the law? We examine the institution of immunity both theoretically and empirically. Our...