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Inequality, good governance, and endemic corruption

Epstein, Gil S. ; Gang, Ira N.



Abstract

Can a society suffering contests between rich and poor achieve good governance in the face of endemic corruption? We examine a stylized poor state with weak institutions in which a "culture of evasion" damages state authority. Many evade tax payments, limiting the state's economic development capability. In the face of extensive corruption, it is challenging for the state to establish and ...

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