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Does Participation in the Global Economy Reduce Political Corruption?: An Empirical Inquiry

NCJ Number
International Journal of Comparative Criminology Volume: 3 Issue: 2 Dated: 2003 Pages: 94-118
Hung-En Sung; Doris Chu
Date Published
25 pages
This comparative study examined the relationship between a country's integration into the global economy (increasing levels of international trade, cross-border capital flows, and a convergence of national legal and institutional arrangements to encourage and protect these economic activities) and national levels of corruption.
Findings support the hypothesis that a country's participation in the world economy is associated with a reduction in corruption. As the relative levels of exports, imports, and foreign direct investment increase, perceptions of government corruption decrease. Countries that rely on exports for their subsistence are significantly less affected by internal corruption, and they are more likely to be responsive to successful competition and responsive to market disciplines; however, indicators of global economic integration as a group were less powerful in predicting corruption than measures of human development, political liberalization, and female political participation. Globalization produced the largest reductions in corruption in countries that were not member states of the Organization for Economic Co-Operation and Development (OECD), had mid-sized gross domestic product, or a small population. Corruption, defined as the abuse of public office in exchange for private benefits, was the dependent variable. Data on corruption were obtained from the Corruption Perceptions Index compiled by the Berlin-based Transparency International. It provides a composite index drawn from various polls and surveys conducted among business people and country analysts, ranking countries by the degree to which corruption is perceived to exist among public officials and politicians. The independent variable, integration into the world economy, was measured by three 1999 trade and investment indicators obtained from the World Bank. Control variables were human development, liberal democratic institutions, and female participation in government. 5 tables, 57 references, and appended list of countries and territories included in the analysis, along with OECD membership status, economy size, and population size