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Corruption and growth in Africa

Author

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  • d'Agostino, G.
  • Dunne, J.P.
  • Pieroni, L.

Abstract

A major concern in the development of African economies is the impact of corruption on economic growth and while there is general agreement on its detrimental effects, there is considerable debate over its nature and importance. In particular there is little work on the interaction between corruption, government expenditures and how this influences economic growth in countries in the region. This paper takes an endogenous growth model, extends it to include different categories of government spending and then introduces the possibility of corruption, which is allowed to have different effects on each of the categories. The results confirm the negative effect of corruption and military spending, but also show that corruption interacts with military burden, through indirect and complementary effects, to further increase its negative effect. The policy implications are that the effects of corruption on economic growth are worse than was thought in countries which have high military burdens.

Suggested Citation

  • d'Agostino, G. & Dunne, J.P. & Pieroni, L., 2016. "Corruption and growth in Africa," European Journal of Political Economy, Elsevier, vol. 43(C), pages 71-88.
  • Handle: RePEc:eee:poleco:v:43:y:2016:i:c:p:71-88
    DOI: 10.1016/j.ejpoleco.2016.03.002
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    Cited by:

    1. Colin C. Williams & Abbi M. Kedir, 2016. "The Impacts Of Corruption On Firm Performance: Some Lessons From 40 African Countries," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 21(04), pages 1-18, December.
    2. Giorgio d’Agostino & J. Paul Dunne & Luca Pieroni, 2017. "Does Military Spending Matter for Long-run Growth?," Defence and Peace Economics, Taylor & Francis Journals, vol. 28(4), pages 429-436, July.
    3. Eunji Kim & Yoonhee Ha & Sangheon Kim, 2017. "Public Debt, Corruption and Sustainable Economic Growth," Sustainability, MDPI, Open Access Journal, vol. 9(3), pages 1-30, March.
    4. El Hamma Imad, 2017. "Do political institutions improve the effect of remittances on economic growth? Evidence from South-Mediterranean countries," Post-Print halshs-01655347, HAL.
    5. repec:eee:wdevel:v:103:y:2018:i:c:p:323-335 is not listed on IDEAS
    6. repec:ebl:ecbull:eb-17-00318 is not listed on IDEAS

    More about this item

    Keywords

    Corruption; Military spending; Development economics; Panel data; Africa;

    JEL classification:

    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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