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Corruption impacting regional economic growth: A dynamic panel data analysis for the case of Vietnam

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  • Hoa T. Truong

Abstract

This study analyses the effects of corruption on Vietnamese provinces and cities’ economic growth using a dynamic panel data analysis with a system generalized method of moments approach. Although this study investigates both the direct and indirect effects of corruption, it focuses more on the direct effects. The estimation results consistently support the assertion that, in general, corruption is detrimental to economic growth. Disaggregating this total effect, however, reveals more noteworthy issues in the Vietnamese context. Corruption directly impedes growth rates by reducing the efficiency of investments, and this effect is more intense in provinces and cities with higher investment rates. However, the adverse direct impact of corruption may be alleviated by its positive impact on investment rates, which is an unexpected finding.

Suggested Citation

  • Hoa T. Truong, 2020. "Corruption impacting regional economic growth: A dynamic panel data analysis for the case of Vietnam," Pacific Economic Review, Wiley Blackwell, vol. 25(5), pages 601-619, December.
    • Handle: RePEc:bla:pacecr:v:25:y:2020:i:5:p:601-619
    DOI: 10.1111/1468-0106.12339
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    2. Ali Celik & Ahmet Kostekci, 2025. "Empirical Exploration of the Drivers of Human Development in Central and West Asian Countries: How Effective Are Control of Corruption, Political Stability and the Rule of Law?," Sustainable Development, John Wiley & Sons, Ltd., vol. 33(3), pages 4652-4675, June.
    3. Mounir Belloumi & Atef Saad Alshehry, 2021. "The Causal Relationships Between Corruption, Investments and Economic Growth in GCC Countries," SAGE Open, , vol. 11(4), pages 21582440211, October.

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