Title
Greasing the Wheels? The Effect of Corruption in Regulated Manufacturing Sectors of India
Abstract
We investigate whether corruption "greases the wheels" of bureaucracies and enhances economic performance. Specifically, we examine the interaction effect of corruption and regulation on the economic performance of manufacturing industries in India. Our estimation results show that the combination of corruption and regulation has significant positive effects on gross value added per worker, total factor productivity, and capital labor ratio. This indicates the existence of a "greasing the wheels" effect.
Keywords
Corruption, Regulation, Gross value added per worker, TFP
JEL Classification
D73, K42, L52, K23
Inquiries
Takahiro SATO
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059
Atsushi KATO
School of Business, Aoyama Gakuin University
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059
Atsushi KATO
School of Business, Aoyama Gakuin University