Renaissance Italy was most definitely characterized by power struggles between competing dynasties, but there was absolutely nothing corrupt about it.

Italian cities had been run as "Republics" since the eleventh century. Now, the meaning of "Republic" for medieval Italians was very different than the meaning you or I might give to the word. Because of the complex history of Italy in the post-Roman era, powerful landed individuals converged onto urban Bishops asking for privileges in the marketplace, arbitration of disputes and in a general sense all the functions of government.

The convergence of many wealthy and powerful individuals in the cities, along with an "Artisan" middle class that could only exist thanks to the density of urbanization, led many cities to adopt a unique, vaguely democratic system of government: commonly called the Communal system (incidentally, my flair topic). Although the system changed from city to city, most established a legislative council of leading families headed by the local Bishop. Often, the leaders of local artisans of merchants guilds were also allowed to participate. Many cities elected a Podestà, who was often required to be a citizen of a different city, to act as a neutral arbiter in council meetings; the mere fact that this could happen attests to the thick web of social relationships in urban communities in Italy.

Between the 13th and 15th centuries, the Milanese, Paduans, Veronese and Florentines were almost continuously involved in some kind low-level warfare, often bullying smaller surrounding towns into submitting in order to establish a ring of fortified burghs around their city, guaranteeing their security. This was interestingly reflected internally, as one family dominated the others within cities, and either pay lip service to the communal institutions while really ruling alone (like the Carrara in Padua, the Dovara in Cremona, and famously, the Medici in Florence) or outright dismantle them, often via bloody internal struggle against opposing families who wanted to keep republican institutions alive (like the Visconti in Milan, the Scaligeri in Verona, and the Ezzellini in Treviso and Vicenza). This wasn't exactly corruption, as specified in the question. Rather, it was a consequence of the fact that democracy in the communes created a space for some families to amass land, wealth, armed followers, and use all three to bully others.

Centralization of the Italian states on the person of the ruling family (the Savoyards in Savoy, Piedmont and the Monferrat, the Visconti in Milan and Lombardy, the Este in Ferrara and the Medici in Florence and Tuscany) was an unavoidable trend which is reflected in centralizations in all early modern Europe. Another consequence of centralization was the subjugation of weaker, and perhaps more republican, states by the "Bullies" (Pisa and Siena by the Florentines, the small lordships of Romagna by the Pope, and nearly all of northeastern Italy by Venice). But by this time, the interests of the state and the interests of the monarch became one and the same.

Books on the Communal System in Italy:

The Lombard League by Gianluca Raccagni (Oxford University Press, 2010)

History of Lombards by Jorg Jarnut (Enaudi, Torino, 2002)

and if you'd like a proper textbook:

The Italian City Republics, by Daniel Philip Waley (Routledge, New York, 2010)

To read about Venice, which is an example of the Italian communal system taken to the nth degree, read A History of Venice by John Julius Norwich