Jump to ContentJump to Main Navigation
Show Summary Details
More options …

The B.E. Journal of Economic Analysis & Policy

Editor-in-Chief: Ludwig, Sandra / Schmitz, Hendrik

Ed. by Auriol, Emmanuelle / Barigozzi, Francesca / Brunner, Johann / Fleck, Robert / Mastrobuoni, Giovanni / Mendola, Mariapia / Requate, Till / de Vries, Frans / Wenzel, Tobias / Zulehner, Christine

IMPACT FACTOR 2017: 0.306
5-year IMPACT FACTOR: 0.492

CiteScore 2017: 0.50

SCImago Journal Rank (SJR) 2017: 0.414
Source Normalized Impact per Paper (SNIP) 2017: 0.531

See all formats and pricing
More options …
Volume 17, Issue 4


Volume 19 (2019)

Volume 6 (2006)

Volume 4 (2004)

Volume 2 (2002)

Volume 1 (2001)

The Impact of Fiscal Transparency on Corruption: An Empirical Analysis Based on Longitudinal Data

Elina De Simone / Giuseppe Lucio Gaeta
  • Department of Human and Social Sciences, University of Naples L’Orientale, Naples, Italy
  • Local Development and Internationalization, cMet05 Inter-University Centre for Applied Economic Studies on Industrial Policy, Ferrara, Italy
  • Email
  • Other articles by this author:
  • De Gruyter OnlineGoogle Scholar
/ Paulo Reis Mourão
Published Online: 2017-10-10 | DOI: https://doi.org/10.1515/bejeap-2017-0021


Fiscal transparency is considered an essential feature of public financial management and is supposed to provide beneficial governance effects such as reducing corruption. This paper adds to recent empirical literature that specifically investigates the impact of fiscal information disclosure on corruption. Country-level evidence provided by previous studies is exclusively based on cross-sectional econometric analyses, while the present contribution relies on a wide-ranging, country-level dataset of 116 countries that cover a ten-year time span (2003–2012), and on dynamic panel data estimates. These innovations in terms of data and methods provide new, robust empirical support to the claim that fiscal transparency is negatively correlated with corruption.

Keywords: fiscal transparency; corruption; panel data; public administration

JEL Classification: D73; H83; D02


  • Aaskoven, L. 2016. “Fiscal Transparency, Elections and Public Employment: Evidence from the OECD.” Economics & Politics 28 (3):317–341.CrossrefGoogle Scholar

  • Ahlerup, P. 2009. “The Causal Effects of Ethnic Diversity: An Instrumental Variables Approach.” Working Papers in Economics No. 386. Gothenburg, Sweden: University of Gothenburg.Google Scholar

  • Aidt, T. S. 2003. “Economic Analysis of Corruption: A Survey.” The Economic Journal 113 (491):632–652.CrossrefGoogle Scholar

  • Alesina, A., and G. M. Angeletos. 2005. “Corruption, Inequality, and Fairness.” Journal of Monetary Economics 52 (7):1227–1244.CrossrefGoogle Scholar

  • Alesina, A., A. Devleeschauwer, W. Easterly, S. Kurlat, and R. Wacziarg. 2003. “Fractionalization.” Journal of Economic Growth 8 (2):155–194.CrossrefGoogle Scholar

  • Alt, J. E., and D. D. Lassen. 2003. “The Political Economy of Institutions and Corruption in American States.” Journal of Theoretical Politics 15 (3):341–365.CrossrefGoogle Scholar

  • Alt, J. E., and D. D. Lassen. 2006. “Fiscal Transparency, Political Parties, and Debt in OECD Countries.” European Economic Review 50 (6):1403–1439.CrossrefGoogle Scholar

  • Andreula, N., and A. Chong. 2016. “Do Good Institutions Improve Fiscal Transparency?” Economics of Governance 17 (3):241–263.CrossrefGoogle Scholar

  • Anti-Corruption Summit|London. 2016. “Communiqué”. 12 May 2016. www.gov.uk/government/uploads/system/uploads/attachment_data/file/522791/FINAL_-_AC_Summit_Communique_-_May_2016.pdf.

  • Antonakis, J., S. Bendahan, P. Jacquart, and R. Lalive. 2014. “Causality and Endogeneity: Problems and Solutions.” In The Oxford Handbook of Leadership and Organizations, edited by D. V. Day, 93–117. New York: Oxford University Press.Google Scholar

  • Arbatli, E., and J. Escolano. 2015. “Fiscal Transparency, Fiscal Performance and Credit Ratings.” Fiscal Studies 36 (2):237–270.CrossrefGoogle Scholar

  • Arellano, M., and S. Bond. 1991. “Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations.” The Review of Economic Studies 58 (2):277–297.CrossrefGoogle Scholar

  • Augustine, T. J., A. Maasry, D. Sobo, and D. Wang. 2011. “Sovereign Fiscal Responsibility Index 2011”. Final Report for the Comeback America Initiative Stanford University. Accessed 28 July 2016. https://publicpolicy.stanford.edu/system/files/A%20Sovereign%20Fiscal%20Responsibility%20Index%20Full%20Report.pdf.

  • Baraldi, A. L. 2008. “Effects of Electoral Rules, Political Competition and Corruption on the Size and Composition of Government Consumption Spending: An Italian Regional Analysis.” The B.E. Journal of Economic Analysis & Policy 8 (1):1935–1682.Google Scholar

  • Bardhan, P. 1997. “Corruption and Development: A Review of Issues.” Journal of Economic Literature 35 (3):1320–1346.Google Scholar

  • Bastida, F., and B. Benito. 2007. “Central Government Budget Practices And Transparency: An International Comparison.” Public Administration 85 (3):667–716.CrossrefGoogle Scholar

  • Bauhr, M., and M. Grimes. 2014. “Indignation or Resignation: The Implications of Transparency for Societal Accountability.” Governance 27 (2):291–320.CrossrefGoogle Scholar

  • Bellver, A., and D. Kaufmann. 2005. “Transparenting Transparency: Initial Empirics and Policy Implications”. Paper presented at the International Monetary Fund Conference on Transparency and Integrity, Washington, DC, July 6–7 2005.Google Scholar

  • Blundell, R., and S. Bond. 1998. “Initial Conditions and Moment Restrictions in Dynamic Panel Data Models.” Journal of Econometrics 87 (1):115–143.CrossrefGoogle Scholar

  • Bobonis, G. J., L. C. R. Fuertes, and R. Schwabe. 2016. “Monitoring Corruptible Politicians.” The American Economic Review 106 (8):2371–2405.CrossrefGoogle Scholar

  • Bond, S., C. Nauges, and F. Windmeijer. 2005. “Unit Roots: Identification and Testing in Micro Panels.” CEMMAP Working Paper No. CWP07/05. https://ssrn.com/abstract=757316.

  • Bond, S. R. 2002. “Dynamic Panel Data Models: A Guide to Micro Data Methods and Practice.” Portuguese Economic Journal 1 (2):141–162.CrossrefGoogle Scholar

  • Bound, J., D. A. Jaeger, and R. M. Baker. 1995. “Problems with Instrumental Variables Estimation When the Correlation between the Instruments and the Endogenous Explanatory Variable Is Weak.” Journal of the American Statistical Association 90 (430):443–450.Google Scholar

  • Caselli, F., G. Esquivel, and F. Lefort. 1996. “Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics.” Journal of Economic Growth 1 (3):363–389. doi:.CrossrefGoogle Scholar

  • Cicatiello, L., E. De Simone, and G. L. Gaeta. 2017. “Political Determinants of Fiscal Transparency: A Panel Data Empirical Investigation.” Economics of Governance. Ahead of print. https://doi.org/10.1007/s10101-017-0192-x

  • Croitorov, O. 2016. Sovereign debt and asymmetric market information. KU Leuven, Discussion Paper Series DPS15.04. Accessed 28 July 2016. https://ssrn.com/abstract=2765451.

  • Cucciniello, M., G. A. Porumbescu, and S. Grimmelikhuijsen. 2017. “25 Years of Transparency Research: Evidence and Future Directions.” Public Administration Review 77 (1):32–44.CrossrefGoogle Scholar

  • de Renzio, P., and J. Wehner. 2015. “The Impacts of Fiscal Openness: A Review of the Evidence.” Global Initiative for Fiscal Transparency. Accessed 2 September 2016. http://www.fiscaltransparency.net/resourcesfiles/files/20150704112.pdf.

  • Debrun, X., and M. Kumar. 2007. “Fiscal Rules, Fiscal Councils and All That: Commitment Devices, Signaling Tools or Smokescreens?.” Paper presented at the Banca d’Italia Public Finance Workshop, Perugia, March 29–31.Google Scholar

  • Dimant, E., and G. Tosato. 2017. “Causes and Effects of Corruption: What Has past Decade’s Empirical Research Taught Us? A Survey.” Journal of Economic Surveys. Ahead of print. http://dx.doi.org/10.1111/joes.12198

  • Ellis, C. J., and J. Fender. 2006. “Corruption and Transparency in a Growth Model.” International Tax and Public Finance 13 (2):115–149.CrossrefGoogle Scholar

  • Ferraz, C., and F. Finan. 2008. “Exposing Corrupt Politicians: The Effects of Brazil’s Publicly Released Audits on Electoral Outcomes.” The Quarterly Journal of Economics 123 (2):703–745.CrossrefGoogle Scholar

  • Ferraz, C., and F. Finan. 2011. “Electoral Accountability and Corruption: Evidence from the Audits of Local Governments.” The American Economic Review 101 (4):1274–1311.CrossrefGoogle Scholar

  • Fisman, R. J., and R. Gatti. 2006. “Bargaining for Bribes: The Role of Institutions.” Centre for Economic Policy Research CEPR Discussion Paper No. 5712.Google Scholar

  • Goel, R. K., and M. A. Nelson. 2010. “Causes of Corruption: History, Geography and Government.” Journal of Policy Modeling 32 (4):433–447.CrossrefGoogle Scholar

  • Grimmelikhuijsen, S. G., and A. J. Meijer. 2014. “Effects of Transparency on the Perceived Trustworthiness of a Government Organization: Evidence from an Online Experiment.” Journal of Public Administration Research and Theory 24 (1):137–157.CrossrefGoogle Scholar

  • Hameed, F. 2005. “Fiscal Transparency and Economic Outcomes.” International Monetary Fund Working paper No. 5/225. Washington DC: International Monetary Fund.Google Scholar

  • Heald, D. 2013. “Strengthening Fiscal Transparency.” In The International Handbook of Public Financial Management, edited by R. Allen, R. Hemming and B. Potter, 711–741. Basingstoke: Palgrave Macmillan.Google Scholar

  • Heywood, P. M. 2015. “Measuring Corruption: Perspectives, Critiques, and Limits.” In Routledge Handbook of Political Corruption, edited by P. M. Heywood, 137–153. London: Routledge.Google Scholar

  • Hollyer, J. R., B. P. Rosendorff, and J. R. Vreeland. 2011. “Democracy and Transparency.” The Journal of Politics 73 (4):1191–1205.CrossrefGoogle Scholar

  • International Monetary Fund. 1998. “Code of good practices on fiscal transparency” (revised in 2001 and 2007). Washington, DC: International Monetary Fund.Google Scholar

  • Hsiao, C. 2007. “Panel Data Analysis – Advantages and Challenges.” Test 16 (1):1–22.CrossrefGoogle Scholar

  • International Monetary Fund (IMF). 2014. Fiscal Transparency Code. Washington, DC: International Monetary Fund.Google Scholar

  • International Monetary Fund (IMF). 2016. “Corruption: Costs and Mitigating Strategies.” IMF Staff Discussion Note No. SDN/16/05. Washington DC: International Monetary Fund.Google Scholar

  • Irwin, T. C. 2016. “Dispelling Fiscal Illusions: How Much Progress Have Governments Made in Getting Assets and Liabilities on Balance Sheet?.” Public Money & Management 36 (3):219–226.CrossrefGoogle Scholar

  • Islam, R. 2006. “Does More Transparency Go Along With Better Governance?” Economics & Politics 18 (2):121–167.CrossrefGoogle Scholar

  • Kaufmann, D., and Bellver, A. 2005. “Transparenting transparency–initial empirics and policy applications.” Presentation at the Pre-Conference on Institutional Change for Growth and Poverty Reduction in Low- Income Countries at the International Monetary Fund, Washington, DC, July 6–7, 2005.Google Scholar

  • Kaufmann, D., and M. Mastruzzi. 2003.World Bank Policy Research Working Paper Series n. 3106 Governance Matters III: Governance Indicators 1996 – 2002.Google Scholar

  • Kopits, G., and J. D. Craig. 1998. “Transparency in Government Operations.” International Monetary Fund Occasional paper. Washington, DC: International Monetary Fund.Google Scholar

  • Kumar, M., and J. Woo. 2010. “Public Debt and Growth.” International Monetary Fund Working paper No. 10/174. Washington, DC: International Monetary Fund.Google Scholar

  • Lederman, D., N. V. Loayza, and R. R. Soares. 2005. “Accountability and Corruption: Political Institutions Matter.” Economics & Politics 17 (1):1–35.CrossrefGoogle Scholar

  • Lindstedt, C., and D. Laurin. 2010. “Transparency Is Not Enough: Making Transparency Effective in Reducing Corruption.” International Political Science Review 31 (3):301–322.CrossrefGoogle Scholar

  • McMann, K. M., D. Pemstein, B. Seim, J. Teorell, and S. I. Lindberg. 2016. “Strategies of Validation: Assessing the Varieties of Democracy Corruption Data.” V-Dem Working Paper No. 23.Google Scholar

  • Nakajima, C., and C. Nakajima. 2016. “The London Anti-Corruption Summit May 2016.” Journal of Financial Crime 23 (4):674–677.CrossrefGoogle Scholar

  • Olken, B. 2007. “Measuring Corruption: Evidence from a Field Experiment in Indonesia.” Journal of Political Economy 1152:200–249.Google Scholar

  • Organization for Economic Cooperation and Development OECD. 2002. OECD Best Practices for Budget Transparency. Paris: OECD.Google Scholar

  • Pellegrini, L., and R. Gerlagh. 2008. “Causes of Corruption: A Survey of Cross-Country Analyses and Extended Results.” Economics of Governance 9 (3):245–263.CrossrefGoogle Scholar

  • Persson, A., B. Rothstein, and J. Teorell. 2013. “Why Anticorruption Reforms Fail – Systemic Corruption as a Collective Action Problem.” Governance 26 (3):449–471.CrossrefGoogle Scholar

  • Reinikka, R., and J. Svensson. 2004. “Local Capture: Evidence from a Central Government Transfer Program in Uganda.” Quarterly Journal of Economics 119 (2):679–705.CrossrefGoogle Scholar

  • Roodman, D. 2009. “A Note on the Theme of Too Many Instruments.” Oxford Bulletin of Economics and Statistics 71 (1):135–158.CrossrefGoogle Scholar

  • Rose-Ackerman, S. 1999. “Political Corruption and Democracy.” Conn. J. Int’l L. 14 (2):363.Google Scholar

  • Seifert, J., R. Carlitz, and E. Mondo. 2013. “The Open Budget Index (OBI) as a Comparative Statistical Tool.” Journal of Comparative Policy Analysis: Research and Practice 15 (1):87–101.CrossrefGoogle Scholar

  • Steinberg, D. A., and K. Malhotra. 2014. “The Effect of Authoritarian Regime Type on Exchange Rate Policy.” World Politics 66 (3):491–529.CrossrefGoogle Scholar

  • Tanzi, V. 1998. “Corruption around the World: Causes, Consequences, Scope, and Cures.” International Monetary Fund Staff Papers No. 559-594. Washington, DC: International Monetary FundGoogle Scholar

  • Tavits, M. 2007. “Clarity of Responsibility and Corruption.” American Journal of Political Science 511:218–229.Google Scholar

  • UNODC. 2004. “United Nations Convention against Corruption, Priorities for the Provision of Technical Assistance. Global Programme against Corruption (GPAC).” http://www.unodc.org/pdf/crime/corruption/corruption_gpac_strategy_jul04.pdf.

  • Wang, R. F., T. Irwin, and L. K. Murara. 2015. “Trends in Fiscal Transparency: Evidence from a New Database of the Coverage of Fiscal Reporting.” International Monetary Fund working paper No. 15/188. Washington, DC: International Monetary FundGoogle Scholar

  • Williams, A. 2009. “On the Release of Information by Governments: Causes and Consequences.” Journal of Development Economics 89 (1):124–138.CrossrefGoogle Scholar

  • Windmeijer, F. 2005. “A Finite Sample Correction for the Variance of Linear Efficient Two-Step GMM Estimators.” Journal of Econometrics 126 (1):25–51.CrossrefGoogle Scholar

  • Wooldridge, J. M. 2010. Econometric Analysis of Cross Section and Panel Data. Cambridge, MA: MIT press.Google Scholar

About the article

Published Online: 2017-10-10

University of Naples Parthenope (Grant/Award Number: ‘2015/2016 individual research incentives’).

Citation Information: The B.E. Journal of Economic Analysis & Policy, Volume 17, Issue 4, 20170021, ISSN (Online) 1935-1682, DOI: https://doi.org/10.1515/bejeap-2017-0021.

Export Citation

© 2017 Walter de Gruyter GmbH, Berlin/Boston.Get Permission

Comments (0)

Please log in or register to comment.
Log in