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The Ill Effects of Public Sector Corruption in the Water and Sanitation Sector

In general, given a particular set of institutions, the greater a county’s per capita income, the more extensive will be its provision of goods and services that require concerted public action. We contend that one of the most important aspects of institutions in this regard is public sector corruption. We test this contention by analyzing 85 countries observed in 1990, 1995, 2000, and 2004—the only years for which data on improved drinking water and adequate sanitation are available. The models point to statistically significant, negative relations between corruption and access to both improved drinking water and adequate sanitation. (JEL D31, H41, P16)