Corruption and economic growth: New empirical evidence

Arbeitspapier

The nexus between corruption and economic growth has been examined for a long time. Many empirical studies measured corruption by the reversed Transparency International's Perception of Corruption Index (CPI) and ignored that the CPI was not comparable over time. The CPI is comparable over time since the year 2012. We employ new data for 175 countries over the period 2012-2018 and re-examine the nexus between corruption and economic growth. The cumulative long-run effect of corruption on growth is that real per capita GDP decreased by around 17% when the reversed CPI increased by one standard deviation. The effect of corruption on economic growth is especially pronounced in autocracies and transmits to growth by decreasing FDI and increasing inflation.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ifo Working Paper ; No. 309

Classification and Topics

• Classification: Wirtschaft ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models ; Structure, Scope, and Performance of Government ; Legal Procedure, the Legal System, and Illegal Behavior: General ; Macroeconomic Analyses of Economic Development
• Subject: Perceived corruption ; economic growth ; panel data

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Gründler, Klaus ; Potrafke, Niklas
• Event: Veröffentlichung
• (who): ifo Institute - Leibniz Institute for Economic Research at the University of Munich
• (where): Munich
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/213586
• Last update: 10.03.2025, 11:46 AM CET