Recent Articles

Read more about our latest published articles.

Review’s Archive

Corresponding Author:
Vladimir Hlasny, Economic Affairs Officer, UN ESCWA, Beirut - Lebanon; Associate Professor Ewha Womans University, Seoul - South Korea

The Implications of Inequality for Corruption: Does the MENA Region Stand Out?

(pp. 1-40)
JEL classification: D73; N35; P52
Keywords: Corruption; Inequality; Institutional Trap; MENA; Arab Variety of Capitalism


If political connectedness and ability to get ahead through corruption are latent dimensions of multidimensional inequality, then corruption could be the missing piece in the Arab inequality puzzle. A positive link between inequality and corruption is found across a large number of developed countries, but not in the MENA or other emerging, resource-reliant countries. An increase in inequality has the expected detrimental effect on corruption in OECD countries, particularly those with state-led non-liberal markets, whereas the relationship is weak or negative in liberal-market economies. Concentration of economic power appears to translate into political power in coordinated and networked societies while the link vanishes in societies where most transactions are done at arm’s length. Inequality affects corruption negatively in emerging and resource-extracting economies, and notably the MENA. MENA thus exhibits the trends seen among less developed economies, an indication of a variety of the Dutch disease.

One explanation could be that successful development and building of institutions initially raise inequality as growth is spread unevenly throughout society. The inequality–corruption link starts out negative and finishes positive across successive stages of development. Hence, beside improving laws and punishing corrupt policymakers, countries should manage economic distribution both out of concern for social justice and to lay down conditions for healthy political and economic contestation.

Read the full article

Download the article in PDF format to read and print.


Acemoglu, D., T.A. Hassan and A. Tahoun (2018), “The Power of the Street: Evidence from Egypt’s Arab Spring”, Review of Financial Studies, 31(1), 1-42.

Acemoglu, D., J.A. Robinson and T. Verdier (2004), “Kleptocracy and DivideandRule: A Theory of Personal Rule”, Journal of the European Economic Association, 2(2-3), 162-192.

Adly, A.I. (2009), “Politically-Embedded Cronyism: The Case of Post-Liberalization Egypt”, Business and Politics, 11(4), 1-26.

Ahmed, E., J.B. Rosser and M.V. Rosser (2007), Income Inequality, Corruption, and the Non-Observed Economy: A Global Perspective, in: M. Salzano, D. Colander (Eds) “Complexity Hints for Economic Policy”, New Economic Windows Series, Springer: Milan.

Alesina, A. and G-M. Angeletos (2005), “Corruption, Inequality and Fairness”, Journal of Monetary Economics, 52(7), 1227-1244.

Alesina, A., S. Michalopoulos and E. Papaioannou (2016), “Ethnic Inequality”, Journal of Political Economy, 124(2), 428-488.

Alesina, A. and E. Zhuravskaya (2011), “Segregation and the Quality of Government in a Cross Section of Countries”, American Economic Review, 101(5), 1872-1911.

Andres, A.R. and C. Ramlogan-Dobson (2011), “Is Corruption Really Bad for Inequality? Evidence from Latin America”, Journal of Development Studies, 47(7), 959-976.

ARDA (2006-2007), Arab Barometer, Association of Religion Data Archives, <>.

Ariely, G. and E.M. Uslaner (2017), “Corruption, Fairness and Inequality”, International Political Science Review, 38(3), 349-362.

Baryshnikova, N.V., N.T.A. Pham and M.M. Wihardja (2016), “Does Political and Economic Inequality Affect Institutional Quality?”, Economic Record, 92(297), 190-208.

Bishara, N.D. (2011), “Governance and Corruption Constraints in the Middle East: Overcoming the Business Ethics Glass Ceiling”, American Business Law Journal, 48(2), 227-283.

Charles-Coll, J. and E.L. Mayer Granados (2017), “How much Inequality is Harmful for Growth? The Growth Maximizing Rate of Inequality in the Context of the Mexican Economy”, Economia Internazionale/International Economics, 70(3), 301-318.

Charmes, J. (2016), The Informal Economy: Definitions, Size, Contribution and Main Characteristics, in: E. Kraemer-Mbula, S. Wunsch-Vincent (Eds), “The Informal Economy in Developing Nations: Hidden Engine of Innovation?”, Cambridge University Press: Cambridge.

Charmes, J. (2019), Dimensions of Resilience in Developing Countries: Informality, Solidarities and Carework, Springer: Cham, Switzerland.

Chekir, H. and I. Diwan (2014), “Crony Capitalism in Egypt”, Journal of Globalization and Development, 5(2), 177-211.

Cunningham, R.B. and Y.K. Sarayrah (1993), Wasta: The Hidden Force in Middle Eastern Society, Praeger: Westport, CT.

Dobson, S. and C. Ramlogan-Dobson (2010), “Is There a Trade-off between Income Inequality and Corruption? Evidence from Latin America”, Economics Letters, 107(2), 102-104.

Dobson, S. and C. Ramlogan-Dobson (2012a), “Inequality, Corruption and the Informal Sector”, Economics Letters, 115(1), 104-107.

Dobson, S. and C. Ramlogan-Dobson (2012b), “Why is Corruption Less Harmful to Income Inequality in Latin America?”, World Development, 40(8), 1534-1545.

Easterly, W. (2007), “Inequality Does Cause Underdevelopment: Insights from a New Instrument”, Journal of Development Economics, 84(2), 755-776.

Erickson, L. and D. Vollrath (2004), “Dimensions of Land Inequality and Economic Development”, IMF Working Paper WP/04/158.

European Audiovisual Observatory (various years), MAVISE - IPFS: Database on TV and On-Demand Audiovisual Services and Companies in Europe, <>.

Farrag, N.A. and A.M. Ezzat (2016), The Impact of Corruption on Economic Growth: A Comparative Analysis between Europe and MENA Countries, in: M. Mustafa Erdoğdu, B. Christiansen (Eds), “Handbook of Research on Comparative Economic Development Perspectives on Europe and the MENA Region”, IGI Global: Hershey, PA.

Farzanegan, M.R. (2013), “Effects of International Financial and Energy Sanctions on Iran’s Informal Economy”, SAIS Review of International Affairs, 33(1), 13-36.

Foellmi, R. and M. Oechslin (2007), “Who Gains from Non-collusive Corruption?”, Journal of Development Economics, 82(1), 95-119.

Forstenlechner, I. and K. Mellahi (2011), “Gaining Legitimacy through Hiring Local Workforce at a Premium: The Case of MNEs in the United Arab Emirates”, Journal of World Business, 46(4), 455-461.

Francis, D.C. (2019), “Informality, Harassment, and Corruption: Evidence from Informal Enterprise Data from Harare, Zimbabwe”, World Bank Policy Research Working Paper No. 8918, World Bank: Washington, DC.

Fraser Institute (2018), Economic Freedom of the World: 2018 Annual Report, <> (accessed 26 November 2018).

Gazdar, K. (2011), Does Corruption ‘Grease the Wheels’ of Growth? Empirical Evidence from MENA Countries, Paper presented at 8th International Forum of the Association of Tunisian Economists, 7-9 June, Hammamet, Tunisia.

Ghoneim, A.F. and A.M. Ezzat (2016), “Growth and Corruption in Arab Countries: What Type of Relationship Connects Them?”, Journal of Economics and International Finance, 8(5), 44-55.

Gilens, M. (2012), Affluence and Influence: Economic Inequality and Political Power in America, Princeton University Press: Princeton.

Guetat, I. (2006), “The Effects of Corruption on Growth Performance of the MENA Countries”, Journal of Economics and Finance, 30(2), 208-221.

Gupta, S., H.R. Davoodi and R. Alonso-Terme (2002), “Does Corruption Affect Income Inequality and Poverty?”, Economics of Governance, 3(1), 23-45.

Hartog, S. (2016), “Is There an Arab Variety of Capitalism?”, Economic Research Forum Working Paper 1068, December.

Hlásny, V. (2014), “Understanding the Competitive Landscape in Morocco’s Telecommunications and Its Socio-economic Implications”, Universitas Gadjah Mada Institute of International Studies Policy Paper, November.

Hlásny, V. (2020), “Top Expenditure Distribution in Arab Countries and the Inequality Puzzle”, Journal of Economic and Social Measurement, 44(4), 177-201.

Hlásny, V. and S. AlAzzawi (2019), “Asset Inequality in MENA: The Missing Dimension?”, Quarterly Review of Economics and Finance, 73, 44-55.

Hlásny V., L. Ceriani and P. Verme (2022) “Bottom incomes and the measurement of poverty and inequality”, Review of Income and Wealth, 68.

Hlásny, V. and V. Intini (2015), “Representativeness of Top Expenditures in Arab Region Household Surveys”, UN ESCWA/EDID Working Paper 11, Beirut, December.

Hlásny V. and P. Verme (2018), “Top Incomes and the Measurement of Inequality in Egypt”, World Bank Economic Review, 32(2), 428-455.

ILO (2013), Women and Men in the Informal Economy: A Statistical Picture (second edition), International Labour Organization: Geneva.

Imam, P.A. and D.F. Jacobs (2007), “The Effect of Corruption on Tax Revenues in the Middle East”, IMF WP/07/270, <>.

Jain, A.K. (2001), “Corruption: A Review”, Journal of Economic Surveys, 15(1), 71-121.

Kalinowski, T. (2016), “Trends and Mechanisms of Corruption in South Korea”, Pacific Review, 29(4), 625-645.

Kalinowski, T. and V. Hlásny (2018), Fair and Square: Social Inequality and Corruption, Presented at SASE conference, Kyoto, June.

Kaufmann, D., A. Kraay and M. Mastruzzi (2010), “The Worldwide Governance Indicators: Methodology and Analytical Issues”, World Bank Policy Research Working Paper No. 5430, World Bank: Washington, DC.

Kutan, A.M., T.J. Douglas and W.Q. Judge (2009), Does Corruption Hurt Economic Development? Evidence from Middle Eastern and North African and Latin American countries, in: S. Sayan (Ed.), “Economic Performance in the Middle East and North Africa: Institutions, Corruption and Reform”, Routledge: London.

Levey, S. (2011), “Fighting Corruption after the Arab Spring”, Foreign Affairs, 16 June. <> (accessed on 20 November 2018).

Mauro, P. (1995), “Corruption and Growth”, Quarterly Journal of Economics, 110(3), 681-712.

Méon, P-G. and L. Weill (2010), “Is Corruption an Efficient Grease?”, World Development, 38(3), 244-259.

Montinola, G.R. and R.W. Jackson (2002), “Sources of Corruption: A Cross-Country Study”, British Journal of Political Science, 32(1), 147-170.

Mungiu-Pippidi, A. and M. Johnston (Eds) (2017), Transitions to Good Governance: Creating Virtuous Circles of Anti-corruption, Edward Elgar: Cheltenham, UK.

Noueihed, L. (2011), “Peddler’s Martyrdom Launched Tunisia’s Revolution”, Reuters World News, 20 January, <>.

Okumu, I.M. and G.F. Forgues-Puccio (2014), “Is the Informal Sector a Window of Hope? Corruption, Informal Sector and Income Inequality”, University of St. Andrews Working Paper, March.

Persson, T., G. Tabellini and F. Trebbi (2003), “Electoral Rules and Corruption”, Journal of the European Economic Association, 1(4), 958-989.

Ramadan, R., V. Hlásny and V. Intini (2018), “Inter-Group Expenditure Gaps in the Arab Region and their Determinants: Application to Egypt, Jordan, Palestine and Tunisia”, Review of Income and Wealth, 64(s1), S145-S188.

Rice, G. (1999), “Islamic Ethics and the Implications for Business”, Journal of Business Ethics, 18(4), 345-358.

Robinson, J.A., R. Torvik and T.Verdier (2002), “Political Foundations of the Resource Curse”, CEPR Discussion Paper 3422, CEPR: Brussels.

Rose-Ackerman, S. and B.J. Palifka (2016), Corruption and Government: Causes, Consequences and Reform, Cambridge University Press: Cambridge.

Rosser, J.B. and M.V. Rosser (2001), “Another Failure of the Washington Consensus on Transition Countries: Inequality and Underground Economies”, Challenge, 44(2), 39-50.

Rosser, J.B., M.V. Rosser and E. Ahmed (2000), “Income Inequality and the Informal Economy in Transition Economies”, Journal of Comparative Economics, 28(1), 156-171.

Rothstein, B. (2011), The Quality of Government: Corruption, Social Trust, and Inequality in International Perspective, University of Chicago Press: Chicago.

Rothstein, B. and S. Holmberg (2011), “Correlates of Corruption”, University of Gothenburg Working Paper Series 2011: 12,


Savoia, A., J. Easaw and A. McKay (2010), “Inequality, Democracy, and Institutions: A Critical Review of Recent Research”, World Development, 38(2), 142-154.

Svensson, J. (2005), “Eight Questions about Corruption”, Journal of Economic Perspectives, 19(3), 19-42.

TI (various years), Corruption Perception Index (CPI), Transparency International: Berlin, <>.

TI (2013), Global Corruption Barometer (GCB), Transparency International: Berlin,  <>.

Uslaner, E.M. (2008), Corruption, Inequality, and the Rule of Law: The Bulging Pocket Makes the Easy Life, Cambridge University Press: Cambridge, UK.

Uslaner, E.M. (2017), The Historical Roots of Corruption: Mass Education, Economic Inequality and State Capacity, Cambridge University Press: Cambridge, UK.

Vaisey, S. and A. Miles (2017), “What You Can — and Can’t — Do with Three-Wave Panel Data”, Sociological Methods & Research, 46(1), 44-67.

Visser, J. (2016), The ICTWSS Database: Database on Institutional Characteristics of Trade Unions, Wage Setting, State Intervention and Social Pacts in 51 Countries between 1960 and 2014, Version 5.1.

Wong, M.Y.H. (2016), “Public Spending, Corruption, and Income Inequality: A Comparative Analysis of Asia and Latin America”, International Political Science Review, 38(3), 298-315.

World Bank (various years), Worldwide Governance Indicators, World Bank: Washington, DC, <>.

World Bank (2002-2016), Enterprise Surveys, World Bank: Washington, DC, <>.

World Values Surveys (WVS, various years), World Values Survey Database, <>.

You, J-S. (2015), Democracy, Inequality and Corruption: Korean, Taiwan and the Philippines Compared, Cambridge University Press, Cambridge, UK.

You, J -S. and S. Khagram (2005), “A Comparative Study of Inequality and Corruption”, American Sociological Review, 70(1), 136-157.

Register your account

First-time users should click on “Register your account” and enter the requested information. Upon successful registration, you will receive an e-mail with instructions to verify your registration.

Submission Guidelines

Authors’ login

Use the assigned user ID and password to login. Please, do not register again. Usernames and passwords may be changed after.

Quick search by author:
Back to the top

Institute for International Economics
of the Genoa Chamber of Commerce

Istituto di Economia Internazionale
Camera di Commercio di Genova
Via Garibaldi, 4 (III piano) - 16124 Genova (Italy)