Journal of Economic Growth

, Volume 14, Issue 3, pp 205–231 | Cite as

Education, corruption, and the distribution of income

  • Theo Eicher
  • Cecilia García-Peñalosa
  • Tanguy van Ypersele


We examine how the interaction between education and corruption affects institutional reform and economic development. While corruption reduces average income and education, education increases not only output and hence potential corruption rents, but also produces more informed electorates that better monitor government actions. We find that economies with intermediate levels of education remain in a poverty trap since the level of skills creates sufficient corruption rents but not enough monitoring. Economies with low or high levels of education can escape the poverty trap, and inequality plays a key role in determining whether this occurs through a change in institutions or an expansion of education.


Inequality Corruption Education Economic development 

JEL Classification



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Copyright information

© Springer Science+Business Media, LLC 2009

Authors and Affiliations

  • Theo Eicher
    • 1
  • Cecilia García-Peñalosa
    • 2
  • Tanguy van Ypersele
    • 3
  1. 1.University of WashingtonSeattleUSA
  2. 2.GREQAM and CNRSMarseilleFrance
  3. 3.GREQAM and CEPRMarseilleFrance

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