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Corruption and Economic Growth in Nigeria: A Cointegration (FM-OLS) Approach

Author

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  • Raymond Adegboyega

    (Olabisi Onabanjo University, Ago Iwoye, Nigeria)

Abstract

Corruption as one of major factors which have slow down economic growth and development in Nigeria has also deterred political and economic reforms which have undermined efforts to improve the living standards of Nigerians and to foster democratic governance. It is evident that the majority of Nigerians see corruption as a serious problem today and most public agencies are rated low in terms of honesty and integrity. Consequently, the factors that drive corruption become pertinent. So, this study examined the effect of corruption on economic growth in Nigeria using fully modified OLS regression technique. Our empirical analysis confirms that in the long run, corruption is negatively related to economic growth which retards economic growth directly and indirectly by increasing poverty and restricting investment. The study recommends among other strategies the implementation of stiff penalties such as stringent punishment for those convicted of corrupt acts in our law courts, promotion of poverty reduction programmes and an enabling environment for inward investments.

Suggested Citation

  • Raymond Adegboyega, 2017. "Corruption and Economic Growth in Nigeria: A Cointegration (FM-OLS) Approach," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 17(1), pages 5-18.
    • Handle: RePEc:pet:annals:v:17:y:2017:i:1:p:5-18
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    References listed on IDEAS

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    More about this item

    Keywords

    corruption; economic growth; FDI; transparency international; trade openness;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • O00 - Economic Development, Innovation, Technological Change, and Growth - - General - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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