Decentralization and Political Corruption: Disaggregating Regional Authority

In this article, we argue that countries with strong regional self-rule offer more incentives and opportunities to form networks of local collusion leading to higher corruption levels. In contrast, shared rule allows for more oversight on the national level which reduces political corruption. Using a recent dataset on regional authority, we test our hypotheses on a sample of up to thirty-six countries between 1984 and 2006 and find robust empirical support for the predicted contrasting effects of regional authority: Self-rule enhances and shared rule limits political corruption.