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Corruption and Imports – is China Different?

Svensson, Elina LU (2012) NEKH01 20112
Department of Economics
Abstract
This Bachelor's Thesis investigates whether China’s corruption effects on trade differ from the rest of the world’s. The question is raised by the seemingly positive correlation between corruption and imports – in direct contradiction to previous research, concluding the relationship to be negative.

Two Gravity Models are evaluated using Panel EGLS (Cross-section random effects) regressions on data from the year 2003, one of which includes the possibility for non-linear effects. The empirical study includes 48 countries and 6084 bilateral observations.

The results establish, in the investigated sample, that China’s corruption effects on imports differ from those of the rest of the world, and that non-linear effects in corruption... (More)
This Bachelor's Thesis investigates whether China’s corruption effects on trade differ from the rest of the world’s. The question is raised by the seemingly positive correlation between corruption and imports – in direct contradiction to previous research, concluding the relationship to be negative.

Two Gravity Models are evaluated using Panel EGLS (Cross-section random effects) regressions on data from the year 2003, one of which includes the possibility for non-linear effects. The empirical study includes 48 countries and 6084 bilateral observations.

The results establish, in the investigated sample, that China’s corruption effects on imports differ from those of the rest of the world, and that non-linear effects in corruption exist. The non-linearity is probably a so-called ”evasion effect”.

It is suggested that China’s anomalous corruption effects are explained by a high level of predictability within the corruption, its size of bureaucracy and the phenomenon Guanxi. (Less)
Please use this url to cite or link to this publication:
author
Svensson, Elina LU
supervisor
organization
course
NEKH01 20112
year
type
M2 - Bachelor Degree
subject
keywords
corruption, imports, trade, China, predictability, Guanxi, bureaucracy, Gravity Model, non-linearity
language
English
id
2338548
date added to LUP
2012-02-13 13:39:25
date last changed
2012-02-13 13:39:25
@misc{2338548,
  abstract     = {This Bachelor's Thesis investigates whether China’s corruption effects on trade differ from the rest of the world’s. The question is raised by the seemingly positive correlation between corruption and imports – in direct contradiction to previous research, concluding the relationship to be negative.

Two Gravity Models are evaluated using Panel EGLS (Cross-section random effects) regressions on data from the year 2003, one of which includes the possibility for non-linear effects. The empirical study includes 48 countries and 6084 bilateral observations. 

The results establish, in the investigated sample, that China’s corruption effects on imports differ from those of the rest of the world, and that non-linear effects in corruption exist. The non-linearity is probably a so-called ”evasion effect”. 

It is suggested that China’s anomalous corruption effects are explained by a high level of predictability within the corruption, its size of bureaucracy and the phenomenon Guanxi.},
  author       = {Svensson, Elina},
  keyword      = {corruption,imports,trade,China,predictability,Guanxi,bureaucracy,Gravity Model,non-linearity},
  language     = {eng},
  note         = {Student Paper},
  title        = {Corruption and Imports – is China Different?},
  year         = {2012},
}