Figure 27.5 and its discussion in the text identify some of the ultimate causes of the Wealth of Nations as Institutions of Economic Growth. One of these is honest government. Go to Gapminder at www.gapminder.org to explore this relationship. Once there, click on the tab for “Gapminder World” and wait a moment for the first graph to load. Once it has loaded, click on the axes and explore the number of variables available for choosing. For this problem, click on the vertical axis, look under “Society,” and choose the “Corruption Perceptions Index (CPI).”
You should still have GDP per capita on the horizontal axis.
a. After noting that higher values in the CPI represent lower levels of corruption, describe what these data are telling you.
b. Next to the upper right-hand corner of the diagram is a “Color” box. Click on it and set it to “Geographic regions.” Now hover over a color and explore where these regions are in the world. Where are the richest countries? Where are the poorest?
c. Can you find some very corrupt countries that are also quite rich? Name some of these countries and determine what they have in common.
d. Does this evidence generally support the claim that an honest government contributes to the wealth of a nation? Why or why not?