WP86: Corruption, institutional discredit, and exclusion of the poor: A poverty trap

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Working papers
Razafindrakoto, Mireille and Francois Roubaud

The vast majority of empirical studies focus mainly on the indirect effects of corruption on poverty using cross-section analyses of macroeconomic aggregates (growth, investment, public expenditure, etc.). To date, relatively few studies have set out to explain the logic of individual behaviour in the face of corruption and the direct effects of this scourge on the poor. We use a rich collection of comparable household surveys conducted in 18 sub-Saharan African countries (Afrobarometer) to shed light on a mechanism that links corruption with poverty such that they are locked in a self-reinforcing vicious cycle. Firstly, we show that the poor, who are as sensitive as the rest of the population to the reprehensible nature of corruption, are more often victims of corruption in their routine dealings with the administration and the public services. Secondly, the poorest groups affected by corruption tend to become discouraged and give in to it more easily. Consequently, they lose interest in politics and can even become politically disaffected altogether. This further diminishes their already limited capacity to make their voices heard in decision-making processes. This attitude of resignation in the absence of any prospect of contending with corruption hence contributes to the acceptance and perpetuation of corruption in poor countries.