The relationship between corruption and public investment at the municipalities’ level in Indonesia

Dartanto, Teguh (2010): The relationship between corruption and public investment at the municipalities’ level in Indonesia. Forthcoming in: China-USA Bussiness Review , Vol. 9,

Abstract

This research is conducted to quantitatively measure the relationship between corruption and public investment at municipalities’ level in Indonesia. According to Nash Equilibrium derived from mixed strategies, the relationship between corruption and public investment can be both positive and negative depending on the level of the corruption Index. Moreover, the econometric estimations from cross section data and pooled data consistently confirm that the relationship between corruption and public investment is in non linear quadratic form. It was found that the public investment reaches the lowest level when the corruption index ranges from 4.42-4.64.

• Item Type: MPRA Paper
• Language: English
• Keywords: Corruption; Public Investment; Game Theory; Regional Development
• Subjects: H - Public Economics > H0 - General; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games

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