Abstract
This paper assesses the impact of corruption on economic growth in the European
Union between 1995 and 2019. Using panel data analysis, the corruption-growth nexus for the 27 members of the European Union is assessed. The results suggest a growth-decreasing effect of corruption. Furthermore, the impact tends to worsen when quality of governance is low. This supports the “sand the wheels” hypothesis, and contradicts the “grease the wheels” hypothesis which states that corruption may mitigate the costs of bad governance. In addition, this paper analyses whether corruption affected growth differently in Central European and Western European countries. The paper finds conflicting results in the impact of corruption in Central
European and Western European countries.
Union between 1995 and 2019. Using panel data analysis, the corruption-growth nexus for the 27 members of the European Union is assessed. The results suggest a growth-decreasing effect of corruption. Furthermore, the impact tends to worsen when quality of governance is low. This supports the “sand the wheels” hypothesis, and contradicts the “grease the wheels” hypothesis which states that corruption may mitigate the costs of bad governance. In addition, this paper analyses whether corruption affected growth differently in Central European and Western European countries. The paper finds conflicting results in the impact of corruption in Central
European and Western European countries.
Original language | English |
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Pages (from-to) | 1-24 |
Number of pages | 24 |
Journal | Anvesak |
Volume | 52 |
Issue number | 1 |
Publication status | Published - 3 Oct 2022 |