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Corruption impacting regional economic growth: A dynamic panel data analysis for the case of Vietnam
Author(s) -
Truong Hoa T.
Publication year - 2020
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/1468-0106.12339
Subject(s) - language change , vietnamese , panel data , assertion , economics , context (archaeology) , investment (military) , generalized method of moments , panel analysis , macroeconomics , development economics , monetary economics , econometrics , politics , political science , geography , art , linguistics , philosophy , literature , archaeology , computer science , law , programming language
This study analyses the effects of corruption on Vietnamese provinces and cities’ economic growth using a dynamic panel data analysis with a system generalized method of moments approach. Although this study investigates both the direct and indirect effects of corruption, it focuses more on the direct effects. The estimation results consistently support the assertion that, in general, corruption is detrimental to economic growth. Disaggregating this total effect, however, reveals more noteworthy issues in the Vietnamese context. Corruption directly impedes growth rates by reducing the efficiency of investments, and this effect is more intense in provinces and cities with higher investment rates. However, the adverse direct impact of corruption may be alleviated by its positive impact on investment rates, which is an unexpected finding.