Saturday, May 23, 2020

A Research Based On A Cross Country Data Essay - 1216 Words

Mauro (1995) conducted a research based on a cross-country data to evaluate causes of corruption worldwide. In â€Å"Corruption and Growth†, he describes the relationship between corruption and economic growth of different countries over the period 1971-1979 and 1980-1983. In his research, Mauro used indices related to corruption from Business International Corporation which sells indices to banks, companies, and investors. The indices are based on the responses of the BI’s analysts from more than 70 countries, and they reflect analysts’ perspective on conditions in a country. The indices have values between 1 and 10, and higher values correspond to a better quality of institutions. Mauro has used nine indices, which, in his opinion, are the best determinants of institutional efficiency: political change (a change in institutional framework due to elections), political stability (disintegration of political activities), probability of opposition group takeover (p robability of the opposition to gain power), stability of labor (possibility of labor disruption), relationship with neighboring countries, terrorism, legal system (efficiency of labor environment), red tape (bureaucracy), corruption. Mauro separated those nine indices into two groups based on how closely the indices are correlated. The first group is labeled as bureaucratic efficiency and includes variables such as legal system, red tape, and corruption. 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