What is to be done when an entire education system is corrupted, when universities sell cheap diplomas and the best academics move abroad? Corruption in the academy can be challenged by a ‘clean universities’ ranking and the power of press coverage.
This study empirically analyzes the effects of de jure financial openness on institutional quality as captured by indicators on investment risk, corruption level, impartiality of judiciary system, and the effectiveness of bureaucracy. We show that a higher degree of financial openness improves institutional quality mainly by reducing investment risks. We also study the effect of a single liberalization reform. Again, we find evidence for the beneficial impact of financial liberalization with the exception of corruption. We additionally show that the benign consequences of financial opening for the institutional development are even larger if financial liberalization is supported by simultaneous political liberalization, while financial deregulation in former socialist countries tends to worsen institutional quality.
The present paper considers corruption to be a deeply complex phenomenon that should be broken down to its essential components in order to develop a deeper understanding of it. Therefore, in this study, corruption shall be broken down into three categories which are namely judicial, bureaucratic and political corruption. These three forms of corruption are “same but different” as even though they all entail the deviation of norms, the scale and effects they have on the society are in fact very different. This paper shall seek to fill the gap by examining and identifying the drivers of corruption through the lens of the general public by using data obtained from TI’s Global Corruption Barometer (GCB). In addition, this study shall also seek to prove that people’s perception of corruption offer valuable insights and should thus be used to triangulate with expert’s opinions to derive a more robust and holistic measure of corruption.