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The effects of corruption on human capital accumulation process: Evidence from Vietnam

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  • Truong Thi Hoa

Abstract

This study aims to identify the effects of corruption on the human capital accumulation process in Vietnamese provinces/cities. I employ labour quality assessments of firms as a proxy for human capital and divide human capital accumulation into the following two processes: an educational process and a process through which educational outcomes and worker training transform into labour quality. The estimation results have some notable implications for the Vietnamese context. Corruption has both negative and positive effects on human capital. On the one hand, corruption reduces the positive effect of local government spending on educational achievements and worsens labour quality. On the other hand, the prevalence of corruption in provinces/cities increases the advantages of local schools in the competition to obtain funds from the central government; hence, corruption enhances educational achievements in those regions. The results of this study indicate that corruption adversely affects human capital overall.

Suggested Citation

  • Truong Thi Hoa, 2020. "The effects of corruption on human capital accumulation process: Evidence from Vietnam," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 28(1), pages 69-88, January.
    • Handle: RePEc:wly:ectrin:v:28:y:2020:i:1:p:69-88
    DOI: 10.1111/ecot.12229
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    References listed on IDEAS

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    1. Martin Rama, 2008. "Making Difficult Choices," World Bank Publications - Books, The World Bank Group, number 28014, December.
    2. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1993. "Why Is Rent-Seeking So Costly to Growth?," American Economic Review, American Economic Association, vol. 83(2), pages 409-414, May.
    3. Mohamed Dridi, 2014. "Corruption and Education: Empirical Evidence," International Journal of Economics and Financial Issues, Econjournals, vol. 4(3), pages 476-493.
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    Cited by:

    1. Jeleta Kebede & Vincent Tawiah & Ernest Gyapong, 2023. "The effect of corruption on microfinance loan portfolio: A semiparametric analysis," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 31(1), pages 241-268, January.
    2. Ho, Manh-Toan, 2020. "The rise of research on development economics in Vietnam: Analyses and implications for the public and policymakers from SSHPA 2008-2020 dataset," Thesis Commons msy6e, Center for Open Science.
    3. , Aisdl, 2020. "The rise of research on development economics in Vietnam: Analyses and implications for the public and policymakers from SSHPA 2008-2020 dataset," OSF Preprints 9nbyr, Center for Open Science.
    4. Fisayo Fagbemi & Tolulope Temilola Osinubi & Geraldine Ejiaka Nzeribe & Taofik Olatunji Bankole, 2022. "Human Capital Development Challenge: Why Corruption Eradication is a Panacea in Nigeria," Journal of Development Policy and Practice, , vol. 7(2), pages 180-205, July.

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