Modelling Corruption Perceptions Through Latent Class Models: Evidence from Eastern Europe and Central Asian Countries

31 Pages Posted: 31 Mar 2015

See all articles by Luca Pieroni

Luca Pieroni

University of Perugia - Department of Economics

Giorgio d'Agostino

University Ca' Foscari, Venice

Date Written: March 31, 2015

Abstract

This work proposes a multidimensional framework, based on a Latent Class model, to identify various types of corruption and their importance. A dataset of Eastern European and Central Asian countries is used to identify four groups of corrupt activities, which go beyond the usual classification of corruption into administrative and political. Estimates are validated by means of a direct administrative corruption index derived from the same dataset and comparison of corruption perception rankings published by Transparency International. The potential of the proposed approach is illustrated with an application to the relationship between firms' competitiveness and the latent classes of corruption identified.

Keywords: Corruption, Eastern Europe and Central Asian economies, latent class models, multidimensional item response theory, firm competitiveness

JEL Classification: C01, C05, K04, H01

Suggested Citation

Pieroni, Luca and d'Agostino, Giorgio, Modelling Corruption Perceptions Through Latent Class Models: Evidence from Eastern Europe and Central Asian Countries (March 31, 2015). Available at SSRN: https://ssrn.com/abstract=2587584 or http://dx.doi.org/10.2139/ssrn.2587584

Luca Pieroni

University of Perugia - Department of Economics ( email )

via Pascoli, 20
PG 06123 Perugia, 06123
Italy

Giorgio D'Agostino (Contact Author)

University Ca' Foscari, Venice ( email )

Fondamenta San Giobbe, Cannaregio, 873
Venice, 30121
Italy

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