TITLE:
Corruption and Levels of Economic Development: A Cross-Country Assessment with Special Reference to Africa
AUTHORS:
Raul Gouvea, Shihong Li, Gautam Vora
KEYWORDS:
Corruption, Economic Development Stage, Africa, African Countries, Institutions, Press Freedom, Regression Analysis
JOURNAL NAME:
Modern Economy,
Vol.10 No.9,
September
23,
2019
ABSTRACT: Cross-country studies of corruption have reported a
negative relationship between corruption and economic development. Yet the
causal direction is unclear. We posit that the relationship between corruption
and economic development is innately interdependent or bidirectional because
they coevolve within a country. Moreover, corruption and economic development
interact with governance, culture, and social development, forming an
interdependent system of quintuple helix.
We examine these factors with a sample of 157 countries, as well as a subsample
of 46 African countries. The results indicate that as countries move away from
a factor-driven economy towards an innovation-driven economy, they observe
lower levels of perceived corruption.
However, the relationship between actual incidence of corruption and economic
development is highly sensitive to covariates in governance, culture, and
social development, consistent with interdependence among these factors. The
factor that consistently explains
perceived and actual corruption is a country’s governance systems, measured by
institutions or press freedom.