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Corruption and Economic Growth in Nigeria: 1986 -2007

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  • Aliyu, Shehu Usman Rano
  • Elijah, Akanni Oludele

Abstract

The World Bank (2000) asserts that corruption is the single greatest impediment to economic growth in third world countries. This study was set out to investigate the impact of corruption on economic growth in Nigeria from 1986 to 2007. A Barro-type endogenous growth model was adopted and reconditioned to suit the purpose of the paper. The Engle-Granger (1987) cointegration and error correction mechanism (ECM) techniques were employed to unit root properties of the variables, their long run relationship and to determine values of long run parameters. The results show that corruption exerts significant direct effect on economic growth and indirectly via some critical variables examined by the paper which include Government Capital Expenditure, Human Capital Development and Total employment. The paper discovers that about 20% of the increase in government capital expenditure ends up in private pockets. It is, therefore, recommended that the government should consolidate on its efforts to fight corruption to a standstill in the country.

Suggested Citation

  • Aliyu, Shehu Usman Rano & Elijah, Akanni Oludele, 2008. "Corruption and Economic Growth in Nigeria: 1986 -2007," MPRA Paper 12504, University Library of Munich, Germany, revised 07 Dec 2008.
    • Handle: RePEc:pra:mprapa:12504
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    References listed on IDEAS

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    Cited by:

    1. Qiang Li & Lian An & Jing Xu & Mina Baliamoune-Lutz, 2018. "Corruption costs lives: evidence from a cross-country study," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(1), pages 153-165, January.
    2. Kuloglu, Ayhan & Lobont, Oana-Ramona & Topcu, Mert, 2012. "A question of causality between political corruption, economic freedom and economic growth in Europe," MPRA Paper 40365, University Library of Munich, Germany.
    3. Ambar, Rabnawaz, 2015. "Corruption, Inequality and Economic Growth," MPRA Paper 70375, University Library of Munich, Germany, revised 2015.
    4. Adekoya Adenuga Fabian & Abdul Razak Nor Azam, 2017. "The Dynamic Relationship between Crime and Economic Growth in Nigeria," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 53(1), pages 47-64, March.

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    More about this item

    Keywords

    corruption; economic growth; cointegration;
    All these keywords.

    JEL classification:

    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

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