The "Asian Paradox" is a debated phenomenon in the field of political economics where growth has persisted among certain regions in Asia despite high levels of corruption. This paper offers a critique of previous literature on the Asian Paradox by investigating the extent to which institutional corruption is associated with income inequality in Asia. Additionally, this paper explores whether the relationship between institutional corruption and income inequality is heterogeneous on a regional basis and whether it depends on the political regime of nations within a region. This discussion is of importance not only in the context of Asia but also in field of political economics, where empirical research in the area is limited due a lack of appropriate data and context alongside its heterodox nature in relation to mainstream economics. However, provided the diversity regarding the political and economic landscape in addition to the Asian Paradox, Asia serves as an ideal case for investigation. Particularly as many economies within the continent has gone through numerous transitions both political regime and economic prosperity. The panel data analysis provides evidence that corruption works through various channels and that, although higher corruption may be associated with higher growth in some circumstances, it may not be associated with improved income distribution. Additionally, the results provide evidence that the relationship between income distribution and institutional corruption is heterogeneous and contingent upon region and regime type.
