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Paper claims Basel II could drive corruption

PROVIDENCE, RHODE ISLAND - Increased bank supervision may drive corruption. That is the central message of a new research paper from Brown University economics professor Ross Levine, and co-researchers Thorsten Beck and Ash Demirgüç-Kunt.

An ex-World Bank employee, Levine was amazed that no empirical analysis had been done on how different bank supervisory policies affect the obstacles firms face in trying to raise capital.

Levine set about collecting regulatory and supervisory data from countries around the globe to be able to begin his quantitative analysis.

Bank supervision and corruption in lending

, published in the Journal of

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