Monday, November 24, 2008

natural disasters and corruption

Another paper out in the most recent Journal of Law and Economics studies the impact of natural disasters on corruption. Sort of. When a natural disaster hits a community in the US, the federal government transfers money to the local areas to help with recovery. The availability of federal funds might increase the return to being a corrupt government official in one of these communities.

Peter Leeson (George Mason) and Russell Sobel (WVU) find a connection between the likelihood of a natural disaster and reported corruption. From their abstract:
Each additional $100 per capita in FEMA relief increases the average state's corruption by nearly 102 percent. Our findings suggest notoriously corrupt regions of the United States, such as the Gulf Coast, are in part notoriously corrupt because natural disasters frequently strike them. They attract more disaster relief, which makes them more corrupt.
Read the article. If that doesn't work, try here.

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