Does corruption affect economic growth?

Ahmad, Eatzaz; Ullah, Muhammad Aman; Arfeen, Muhammad Irfanullah

doi:10.7764/laje.49.2.277

Cited by 85 publications

(79 citation statements)

References 26 publications

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“…It exerts negative effects on both economic and social spheres (Aguilera and Vadera 2008;Ahmad et al 2012;Davis and Ruhe 2003;Gray and Kaufman 1998;Mauro 1995;Mo 2001;Swaleheen 2011). Corruption also has negative consequences in the political domain, such as reduced interest in political participation, impaired democracy, and social inequality (Judge et al 2011).…”

Section: Corruption Perception and Political Participationmentioning

confidence: 98%

Life Satisfaction as a Buffer of the Relationship Between Corruption Perception and Political Participation

Zheng

Huang

et al. 2016

Soc Indic Res

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The present article aimed at exploring the effect of corruption perception on political participation and the moderating role of life satisfaction on this relationship. To accomplish these objectives, we collected both survey and experimental data. In Study 1, corruption perception, life satisfaction, and political participation were all measured using self-report scales. The results indicated that corruption perception was negatively associated with political participation, and that life satisfaction moderated the relationship between corruption perception and political participation. In Study 2, corruption perception was manipulated by placing respondents in either a high-corruption or a low-corruption condition with subliminal priming. Compared with the high-corruption condition, the respondents primed by the low-corruption condition reported greater political participation. Furthermore, corruption perception hampered political participation only when life satisfaction was low. The results of the two studies confirmed that corruption perception attenuated political participation and that life satisfaction served as an appraisal buffer to alleviate this effect. The implications of the findings are discussed.

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Section: Corruption Perception and Political Participationmentioning

confidence: 98%

Life Satisfaction as a Buffer of the Relationship Between Corruption Perception and Political Participation

Zheng

Huang

et al. 2016

Soc Indic Res

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“…Empirical literature, for instance, the works of Mauro and Carmeci (2007), Nageri, Gunu and Falilat (2013) and Ekundayo et al (2013) have consistently reported a negative linear relationship between economic growth and economic crimes except the works of Ahmad et al (2012) and Aidt, Dutta and Sena (2008) who found non-linear relationship between economic growth and economics crimes in a panel of countries. It is, however, not certain if a non-linear relationship exists between economic crimes and economic growth in Nigeria as no empirical investigation on the relationship between economic growth and economic crimes have come to this conclusion.…”

Section: Introductionmentioning

confidence: 99%

“…Moreover, corruption perception index is just the perception of individuals with regard to corruption and this perception is largely subjective with minimal time points. Ahmad et al (2012) using panel data from 1984 to 2009 for 71 developed and developing countries, with corruption index, corruption squared, bureaucratic efficiency index, political stability index, institutional efficiency index, risk to investment index etc while employing generalized methods of moments estimation (GMM) find that decrease in corruption raises economic growth rate in an inverted U-shaped way. Aidt et al (2008), in an empirical study on Governance Regimes, Corruption and Growth: Theory and Evidence in a panel data analysis using voice and accountability index, corruption index and gdp as variables found a non-linear relationship between corruption and growth and therefore concluded that there is no relationship between corruption and growth in countries with low-quality political institutions.…”

Section: Empirical Literature Reviewmentioning

confidence: 99%

“…Ahmad et al (2012) adopted the standard production function, which extends Solow's original approach to growth accounting process while Detotto et al (2010) adopted OLS technique incarnated in a State Space Model enabling the capture of time-varying elasticity coefficient of crime on growth. The point of divergence of the present study from that used by Detotto et al (2010) is that the present study used economic crimes (Illicit Financial Outflows as proxy) instead of murder as one of the explanatory variables explaining economic growth.…”

Section: Model Specification and Analytical Techniquesmentioning

confidence: 99%

“…Specifically, Wedeman (1997) observe that many corrupt countries have rapid growth rates. However, Ahmad, Ullah and Arfeen (2012) and Powell, Manish and Nair (2010) find economic crimes to be growth-enhancing at low levels of incidence and growth-reducing at high levels of incidence.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Impact of Economic Crimes on Nigeria’s Economic Prosperity under A Democratic Framework

Nwogwugwu

Uzoechina²

2015

IJBM

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Although, economic crimes are not new phenomena in Nigeria, however, their size, sophistication and magnitude have changed in recent times. Theoretical literature on economic crimes and economic growth has generated a rich debate over the last few years producing scholars who theorized that economic crimes could be growth-enhancing and others who see it as growth-reducing. Where is Nigeria in this great debate? The failure to determine the nature of the relationship between economic crimes and economic growth in previous empirical works affected the choice of methodology employed by previous empirical works on Nigeria. This study is an attempt to offer a better methodology and proxy in the estimation of this relationship. Therefore, this study aims at providing robust econometric analysis, which deepens the understanding of the relationship between economic crimes and economic growth in Nigeria both in the short run and long run within the uninterrupted democratic dispensation period of 1999 to 2012 using OLS technique incarnated in a state-space time-varying methodology. Findings show a strong evidence of non-linear significant relationship between economic crimes and economic growth in Nigeria in the long-run with infinitesimal short run impact. The study also found a bi-directional causal relationship between economic crimes and economic growth in Nigeria and recommends, amongst others, a matrix of policies that address effective reduction of economic crimes, which includes heavy investment in infrastructure especially energy which nourishes industrial build-up that in turn creates employment as well as reduce the level of poverty.

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Institutional quality and economic growth: Evidence from South‐Asian countries

Mehmood

Din

Aman‐Ullah

et al. 2022

Journal of Public Affairs

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The current study investigates the relationship between institutional quality and economic growth, focusing on South‐Asian countries entailing Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka, from 2002 to 2018. The data are analysed using the dynamic heterogeneous panel (panel autoregressive distributed lag [ARDL] model) approach, specifically the dynamic fixed effect (DFE), mean group (MG), and pooled mean group (PMG). Based on the findings, the three governance indicators, namely corruption control, accountability, and the rule of law, positively and significantly affect economic growth. All the nations have consistent long‐run estimates but varied short‐run estimates and adjustment speed for the long‐term equilibrium. This is due to governance volatility that is evident in all the nations. This article offers both practical and theoretical contributions. This article contributes to the institutional quality and economic growth literature from a theoretical perspective from the South‐Asian perspective. From a practical perspective, the study findings are significant for policymakers, particularly those from the countries that demonstrate major fiscal and external imbalance due to war and terrorism, low oil prices and weak trade. Hence, there is a pressing need to address economic growth issues instigated by the policymakers' negligence to ensure appropriate governance and macroeconomic management. Regulators can improve economic growth through national and regional image building by developing a stable economic and political landscape and maintaining macroeconomic stability by improving the institutional quality indicators. There is evidence that institutional quality improvement leads to better economic growth.

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Does corruption affect economic growth?

Cited by 85 publications

References 26 publications

Life Satisfaction as a Buffer of the Relationship Between Corruption Perception and Political Participation

Life Satisfaction as a Buffer of the Relationship Between Corruption Perception and Political Participation

Impact of Economic Crimes on Nigeria’s Economic Prosperity under A Democratic Framework

Institutional quality and economic growth: Evidence from South‐Asian countries

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