In developing countries, large public wage premiums are confirmed. On the other hand, in developed countries, small public wage premiums exist but they are close to zero. According to seminal theoretical works on corruption, offering public workers a higher wage than they can get elsewhere reduces corruption. However, data on corruption indicates that developing countries suffer more severe corruption. Thus, the observed evidence that larger public wage premiums and higher levels of corruption coexist in developing countries, while smaller or zero premiums and lower levels of corruption coexist in developed countries is puzzling. To the best of our knowledge, no theoretical study explains this puzzle. The aim of this paper is to provide an explanation for the aforementioned puzzle by analyzing the relationships among public wages, corruption, and economic development.