Does Corruption Grease or Sand the Wheels of Growth? Panel Evidence from the European Union

Anton Sneyders, Aad van Mourik

Research output: Contribution to journalArticleAcademicpeer-review

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.
Original languageEnglish
Pages (from-to)1-24
Number of pages24
JournalAnvesak
Volume52
Issue number1
Publication statusPublished - 3 Oct 2022

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