Corruption and economic growth: A meta-analysis of the evidence on low-income countries and beyond

Abstract

Corruption is a symptom and outcome of institutional deficiency, with potentially adverse effects on economic growth. This paper aims to provide a synthesis of the existing evidence on the relationship between corruption and economic growth - controlling for effect type, data sources, and country groupings. Using 32 key search terms and 43 low-income country names, we searched in 20 electronic databases and obtained 1,002 studies. Initial screening on the basis of PIOS (Population-Independent Variable-Outcome-Study Design) criteria and critical evaluation on the basis VRA (Validity-Reliability-Applicability) criteria led to inclusion of 115 studies for analysis. We conduct a meta-analysis of the empirical findings in 72 empirical studies, using fixed-effect and random-effect weighted means and testing for significance through precision-effect tests (PETs). Our findings indicate that corruption has a negative effect on per-capita GDP growth overall. We also report that corruption is relatively more detrimental in mixed countries as opposed to low-income countries only and that indirect effects of corruption on growth (through the human capital and public finance channels) are larger than its direct effects.Corruption, institutions, governance, economic growth, meta-analysis, systematic reviews