www.sire.ac.uk Colonialism, Elite Formation and Corruption

This paper argues that corruption in developing countries has deep historical roots; going all the way back to the characteristics of their colonial experience. The degree of European settlement during colonial times is used to di¤erentiate between types of colonial experience, and is found to be a powerful explanatory factor of present-day corruption levels. The relationship is non-linear, as higher levels of European set-tlement resulted in more powerful elites (and more corruption) only as long as Europeans remained a minority group in the total population.