2015/04/20 by Philip Hans Franses, Bert de Groot
Social Sciences · Economics, Econometrics and Finance · #Corruption and Economic Development #Culture, Economy, and Development Studies #Taxation and Compliance Studies
paper · pdf · doi:10.1007/s11135-015-0202-4
Corruption may lead to tax evasion and unbalanced favors and this may lead to extraordinary wealth amongst a few. We study for 13 countries 6 years of Forbes rankings data and we examine whether corruption leads to more inequality amongst the wealthiest. When we correct in our panel model for current and one-year lagged competitiveness and GDP growth rates, we find no such effect. In fact, we find that more competitiveness decreases inequality amongst the wealthiest.