Distributive effects and moral justification of corruption

The moral justification of corruption differs within and across countries. In general terms, rich individuals will have more capacity to invest resources in corruption than low income earners. On the one hand, high income individuals can better face the cost of corrupt transactions, when necessary (for example, when bribes are required). On the other hand, high income individuals might have incentives to promote corrupt deals in areas where high public expenditure is involved, especially when accompanied by highly political discretion and lack of transparency. In this sense, as the public expenditure increases, those who are potential beneficiaries from grand corruption (high income earners), will increase their opportunities for rent-seeking. On the contrary, low income individuals not only lack enough resources to involve in petty corruption deals, but also they are more affected by the deviation of public resources that grand corruption implies. As the literature points out, corruption distorts the efficient distribution of public expenditure. That is, corruption may imply that political decisions related to public expenditure favor some individual interests against the interests of the majority. In this sense, corruption diverts resources from the poor to the rich. Therefore, we can expect that income will have an impact on justification of corruption. We empirically test the relationship between income and the justification of corruption by using a sample of 50 countries worldwide. Multilevel models allow us to take into account the effect of contextual variables at the aggregate level. Specifically, we analyze the impact of inequality on the moral justification of corruption at the aggregate level and how inequality has an impact on the relationship between income and justification of corruption at the individual level.