The Effect of Corruption on Economic Development in Nigeria: 1996-2016

Abstract

The paper focuses on the relationship between corruption and poverty as well as impact of corruption on economic growth in Nigeria for the period, 1996-2016. Corruption is a canker worm that has reduced development in all facets of the economy as it has eaten deep to the extent that major economic indicators are negatively affected. The study relied on both descriptive and econometric methods to analyze the data. Specifically, the study uses ordinary least square method to explore the contemporaneous dynamics. The study finds that poverty is positively and significantly responsive to corruption. It was also observed that corruption perception index and corruption rank exerted negative impact on economic growth. The study argued that the trends of corruption perception index and the country’s annual ranking as among the most corrupt countries in the world has tended to undermine economic growth. The study noted that anti-graft agencies (EFCC and ICPC) must been adequately funded and equipped in order to mitigate against corruption without government interference.

Keywords: Corruption Perception Index, Corruption Rank, Economic Growth and ARDL model.