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Capital Flight and Extent of Corruption control in the Least Corrupt African Countries: An Empirical assessment

Author

Listed:
  • Pacific K. T. Yapatake

    (Yaounde, Cameroon)

  • Gabriella M-A. M Ngaba

    (Yaoundé, Cameroon)

Abstract

The purpose of this paper is to investigate the effect of corruption control on capital flight in the least corrupt African countries and uses panel data covering the period of 1996-2010. The results show that the extent of corruption proxy, the total natural resources rent are statistically significant and affect positively the capital across the pooled, random and fixed effects. Inflation and economic growth are also found to have a negative impact on capital flight. Moreover, exchange rate has a negative and significant effect on capital flight. The findings of this study suggest that the extent of corruption control by responsible institutions can be considered as one of the most effective weapons in the fight against capital flight in the least corrupt African countries. The paper recommends to the government of the least corrupt countries in Africa to create an enabling political and economic environment for investor’s attractiveness. This in turn will reduce the occurrence of capital flight and lead to the sustainable development.

Suggested Citation

  • Pacific K. T. Yapatake & Gabriella M-A. M Ngaba, 2019. "Capital Flight and Extent of Corruption control in the Least Corrupt African Countries: An Empirical assessment," CEREDEC Working Papers 19/002, Centre de Recherche pour le Développement Economique (CEREDEC).
    • Handle: RePEc:aby:wpaper:19/002
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    References listed on IDEAS

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    More about this item

    Keywords

    Capital flight; extent of corruption control; Panel data; the Least Corrupt African Countries;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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