Corruption and growth in Sub Saharan African countries: Do differences in government effectiveness matter?
Authors
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Yibrah Hagos Gebresilassie
Department of Economics, Aksum University, Aksum, Tigray, Ethiopia.
https://orcid.org/0000-0003-0402-0773
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Hafte Gebreselassie Gebrihet
Nelson Mandela School of Public Governance, University of Cape Town, Cape Town, South Africa and Adigrat University, Department of Civics and Ethical Studies, Adigrat, Tigray, Ethiopia.
https://orcid.org/0000-0002-3436-641X
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Gabriel Temesgen Woldu
Institute of Economics and Economic Development, Department of Theoretical Economics, University of Szeged, Hungary, and Department of Economics, Adigrat University, Adigrat, Tigray, Ethiopia.
https://orcid.org/0000-0003-4092-4286
DOI:
https://doi.org/10.18488/35.v11i1.3609Abstract
Corruption remains a significant global concern and affects economic growth ( ). Despite extensive research on the relationship between corruption and economic growth in developed countries, the effects of corruption and governance on economic growth in countries in Sub-Saharan Africa (SSA) remain unclear. This study aims to fill this gap in the literature by examining the impacts of corruption, government effectiveness ( ), and their joint interactive effects on economic growth in a panel of 37 countries in SSA from 2012 to 2022. The data were from multiple sources (the World Bank, the International Monetary Fund, and Transparency International) and analyzed using a two‑step generalized method of moments (SGMM) technique. The results of the SGMM demonstrate that corruption has a detrimental effect on the economic growth of countries in the SSA. Furthermore, the findings of the analysis reveal that government effectiveness significantly lowers the economic growth of countries in Sub-Saharan Africa. Most importantly, the results of regression analysis indicate that the joint interactive effect of corruption and government effectiveness ( ) depresses economies in countries in Sub-Saharan Africa, which is a novel finding. Therefore, this study recommends that in order to support the long-term economic growth of Sub-Saharan African nations, governments should create policies and strategies to combat corruption and improve institutional quality.
