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Corruption Across Countries and Regions: Some Consequences of Local Osmosis

By Raaj Sah

Abstract

Large and persistent differences in corruption across comparable countries often are loosely attributed to unarticulated “cultural factors.” Such attributions may indicate a lack of firmer perspectives from social sciences. An even more challenging research issue is the presence of such differences across regions within the same country, because, in comparison to different countries, such regions generally share more socioeconomic and governance characteristics. A principal theme of this paper is that an individual’s perceptions of his or her environment are influenced by the realities that this individual and others have faced in the past, and that these perceptions affect current and future actions of individuals, which in turn exert influences on the current and future realities. A dynamic analysis of this theme yields a number of observations concerning individuals’ behavior and societal outcomes.

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