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Corruption, Privatisation and Economic Growth in Post-communist Countries

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  • Andrzej Cieślik
  • Łukasz Goczek

Abstract

This article empirically investigates the effects of corruption and privatisation on economic growth in the post-communist countries of Central and Eastern Europe and the former USSR. We use a corruption and privatisation augmented open-economy leader–follower endogenous growth model to derive our research hypotheses. In this setting, corruption, privatisation and external openness jointly determine the per capita income in the follower economy. This model predicts that economies with higher shares of private ownership, lower corruption, and higher external openness enjoy higher rates of growth. Our empirical verification of these predictions is based on a panel of 29 post-communist countries during the period 1996–2014. Our estimation results confirm the negative effects of corruption, while the positive effects of privatisation are limited to small-scale privatisation.

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  • Andrzej Cieślik & Łukasz Goczek, 2018. "Corruption, Privatisation and Economic Growth in Post-communist Countries," Europe-Asia Studies, Taylor & Francis Journals, vol. 70(8), pages 1303-1325, September.
    • Handle: RePEc:taf:ceasxx:v:70:y:2018:i:8:p:1303-1325
    DOI: 10.1080/09668136.2018.1511771
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    2. Goczek Łukasz & Witkowski Bartosz & Witkowska Ewa, 2022. "Does an increase in education quality cause developing countries to catch up?," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 58(4), pages 393-408, December.

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