FSS-DGPA seminar: Types of Government Intervention and Corruption: Evidence from Europe

Speaker: Prof.Germà BEL, UM Distinguished Visiting Scholar

Date:16 May 2024 (Thu)

Time:11:00 – 12:30

Venue: E21B-G002

Abstract: Evidence on the relationship between government size and corruption is mixed and can be misleading, as government size is typically measured by fiscal size. The core hypothesis in this research is that the type of government intervention in the economy – rather than the size of government – is a key explanatory factor for corruption. This hypothesis is tested for the countries of the European Economic Area (EEA: European Union -EU- and European Free Trade Area -EFTA-). The empirical analysis unravels the effects of the two main government intervention tools: fiscal and regulatory. Fiscal intervention is measured by government spending, and regulatory intervention is measured by regulatory quality. The main result is that fiscal burden has no significant relationship with corruption. Instead, a consistent and significant positive association is found between regulatory burden and corruption. Furthermore, legal origins and democratic experience contribute to explaining differences in corruption between European countries.