Does Corruption Facilitate Growth? A Cross-national Study in a Non-linear Framework. (December 2017)

• Record Type: Journal Article
• Authors: Saha, Shrabani; Mallik, Girijasankar; Vortelinos, Dimitrios
• Is Part Of: South Asian journal of macroeconomics and public finance. Volume 6:Number 2(2017:Dec.)
• Page Start: 178
• Page End: 193
• Publication Date: 2017-12
• Subjects: Corruption -- growth -- non-linearity; Macroeconomics -- Periodicals; Finance, Public -- Periodicals; Finance, Public -- South Asia -- Periodicals; Economics -- Periodicals; Public Sector -- economics -- Periodicals; 339.0954
• DOI: 10.1177/2277978717727174
• Languages: English
• ISSNs: 2277-9787

Abstract

The article examines the corruption–growth relationship in a non-linear framework using panel fixed effects (FE) and system generalized methods of moments (SGMM) model for over 110 countries for the period 1984–2009. The results reveal that the least corrupt countries enjoy higher growth rates, whereas highly corrupt countries experience low growth. Furthermore, corruption has a positive and significant effect on economic growth up to a certain level and thereafter it reduces growth. The results are robust under various methodology and an alternative measure of corruption. JEL Classification: D73, O47, O50