There is an increasing recognition in the public domain that corruption and otheraspects of poor governance have substantial adverse effects on the distribution of income. Corruption has direct and indirect consequences on economic and governance factors,which in turn exacerbate inequality. Much of the literature on corruption and inequality is recent – from the mid-1990s – when major international donor institutions began to focus attention on corruption issues and researchers initiated cross-country measurements of the corruption phenomenon.While the research over the impact of corruption on inequality has continued,another major issue has emerged on the
international development agenda. This is the finance–inequality relationship (Claessens
and Perotti, 2007). Although, a large literature