ABSTRACT
Within the economic literature on corruption, the idea that ‘different political systems foster different levels of corruption’ (Ali and Isse 2003) has been receiving increasing attention. Causal explanations on the emergence and pertinence of corrupt transactions no longer focus on the specification of contracts, but have shifted their attention to the role of the institutional environment as an important explanatory factor of corruption. In other words, the new research has shown a tendency to consider the idea that the outcome of transactions is not solely determined by the structure and quality of institutional arrangements at the micro-level, but also by the entrenched institutional environment. The preliminary account suggests that environments characterized by institutional deficiencies seemingly offer fertile grounds for corruption (World Bank 2002). This account is supported by the fact that high national corruption levels heavily burden almost all transition economies, typically characterized by a hybrid and weak institutional environment.
