Journal of Economic Research (Tahghighat- E- Eghtesadi)

Journal of Economic Research (Tahghighat- E- Eghtesadi)

Decentralization, Corruption and Economic Growth (Case Study: Oil Exporting Countries)

Document Type : Research Paper

Author
vahid shaghaghi shahri
While most of the studies have looked at the relationship between decentralization and corruption, or between decentralization and growth, or between corruption and growth, few have looked at the joint relationship between the three.
10.22059/jte.2021.81017
Abstract
While most of the studies have looked at the relationship between decentralization and corruption, or between decentralization and growth, or between corruption and growth, few have looked at the joint relationship between the three.
This article represents a contribution to the literature on the relationship between decentralization, corruption and economic growth. This relationship is analyzed both theoretically and empirically by using panel data techniques for the selected oil exporting countries during 1998-2017. By regarding the countries' dependence on oil export, these countries have a concentrated structure and are rife with corruption. 
The result for fixed effects regressions indicate that corruption does indeed have a negative effect on growth as the estimated coefficients for control of corruption variable in the various growth models are positive by
0.74, 0.53, 0.62.
The decentralization indicators have a significant and positive effect on economic growth by 0.43, 0.13 and 0.18. Finally, the results suggest that the negative effect of corruption on economic growth is reduced by decentralization, as the interaction term coefficient is positive for two of the regressions undertaken.
JEL Classification: H72, H77, D73, O40
 
Keywords
Decentralization
Corruption
Economic growth
Oil exporting countries
Panel data technique

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  • Receive Date 19 September 2020
  • Revise Date 20 February 2021
  • Accept Date 17 April 2021