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refahj 2023, 22(87): 9-34 |
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emadzadeh M, tibash B. (2023). The effect of corruption on human development in selected Islamic countries (an approach from the ARDL panel model). refahj. 22(87), : 1 doi:10.32598/refahj.22.87.3984.1
URL: http://refahj.uswr.ac.ir/article-1-3962-en.html
URL: http://refahj.uswr.ac.ir/article-1-3962-en.html
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Introduction
Corruption means the misuse of public resources for personal gain, which reduces economic growth, and consequently, development in any country. For example, corruption decreases by reducing foreign and domestic investment, increasing inflation, increasing rent-seeking activities, lack of optimal allocation of resources and upsetting the market balance, reducing tax revenues, increasing income inequality, poverty, increasing infant mortality, and higher inequality in education quality, leading to human development (Emara, 2020). Corruption also disrupts the allocation of public resources, as corruption diverts public resources from infrastructure investments that benefit the poor such as schools and hospitals, to centralize capital, because through the purchase of equipment, there are more opportunities for bribes will be provided. Corruption also affects the quantity and quality of education and health services that are essential to building human capital. Because it reduces the corruption of resources available to provide social services, including education. Also, if there is bribery when hiring and promoting teachers, the quality of education will decrease. Corruption affects the government's ability to increase access to education. Corruption may also worsen the quality of health care, as patients suffer from inadequate treatment and lack of medicine, and access to health care may be limited or delayed in order to receive bribes from health care providers (Gupta et al., 2000). So opponents of the theory of corruption believe that corruption causes poverty and disrupts the allocation of public resources, and it has a negative impact on health and education (Aidt, 2010; Campos et al., 2010). Corruption has direct and indirect negative effects on human development. First, corruption can affect human development by slowing economic growth, and second, it shifts government investment from basic sectors, such as health and education to non-productive sectors (Emara, 2020). On the other hand, proponents of the positive impact of corruption on the economy believe that corruption facilitates trade and can increase economic growth by stimulating entrepreneurship and productivity, and by helping the private sector to avoid a very deterrent regulatory environment (Palash, 2018). The hypothesis of the effect of human development on corruption is based on the fact that if citizens have a higher standard of living, life expectancy, and better education, they will be less prone to corruption. The level of human development may affect the level of corruption in a society because the general lack of awareness of political rights, and restrictions on access to the judiciary are likely to prevent the poor people from recognizing responsibility of politicians and government (Mazllami , 2019).
Methods
In order to investigate the impact of corruption on human development and in the short and long term, the Pooled Mean Group model (PMG) was used. The form of the error correction patterns will be as follows:
TRADE
Wherein LCOR is the corruption control index introduced by the World Bank. The HDI Human Development Index was collected from the United Nations website. The LGDPP also represents the fixed GDP per capita in 2010, the data of which were collected from the World Bank. LG refers to the size of government (the ratio of government spending to GDP). This index is also collected from the World Bank. LTRADE, also a trade openness index obtained from the ratio of total exports and imports to GDP, compiled by the World Bank. βs represent the estimated coefficients in the long run, and , and
Finding
Table 1 estimation results
Source: Research Findings, The numbers in parentheses represent the t-statistic.
Based on table 1, in the long run, the impact of corruption index on human development was positive. The impact of logarithm of GDP has positive impact on human development. The impact of logarithm of government consumption on human development were negative. However, the result of corruption index on human development was negative in short run. The impact of human development on corruption index was also negative in short run.
Discussion:
The effect of corruption control index, which means reduction of corruption, on human development index, is positive and significant in the long run. On the other hand, the effect of the corruption control index in the short run has been negative and statistically significant. In other words, in the short run, corruption has improved the status of the human development index. On the other hand, the impact of the Human Development Index on reducing corruption has been positive in the long run and negative in the short run. Therefore, it can be concluded that in the short term, due to corruption and bribery, people have been able to have better access to health services and education, and people have been able to achieve greater prosperity by circumventing strict and cumbersome laws. But in the long run, corruption has had a negative impact on the economic and infrastructure sectors, and appropriate policies need to be put in place to reduce corruption. On the other hand, the positive impact of human development in the long run on reducing corruption highlights the need to fight corruption. The negative impact of human development on reducing corruption in the short term can be due to the increase in the ability of individuals to pay bribes due to the improvement of the welfare of individuals and the lack of improvement of institutional quality in the short term with the improvement of human development.
Ethical considerations
Authors’ contributions
All authors contributed in producing of the research.
Funding
The present study did not have any sponsors.
Conflicts of interest
The authors declared no conflict of interest.
Following the ethics of research
In this article, all rights relating to references are cited and resources are carefully listed.
Corruption means the misuse of public resources for personal gain, which reduces economic growth, and consequently, development in any country. For example, corruption decreases by reducing foreign and domestic investment, increasing inflation, increasing rent-seeking activities, lack of optimal allocation of resources and upsetting the market balance, reducing tax revenues, increasing income inequality, poverty, increasing infant mortality, and higher inequality in education quality, leading to human development (Emara, 2020). Corruption also disrupts the allocation of public resources, as corruption diverts public resources from infrastructure investments that benefit the poor such as schools and hospitals, to centralize capital, because through the purchase of equipment, there are more opportunities for bribes will be provided. Corruption also affects the quantity and quality of education and health services that are essential to building human capital. Because it reduces the corruption of resources available to provide social services, including education. Also, if there is bribery when hiring and promoting teachers, the quality of education will decrease. Corruption affects the government's ability to increase access to education. Corruption may also worsen the quality of health care, as patients suffer from inadequate treatment and lack of medicine, and access to health care may be limited or delayed in order to receive bribes from health care providers (Gupta et al., 2000). So opponents of the theory of corruption believe that corruption causes poverty and disrupts the allocation of public resources, and it has a negative impact on health and education (Aidt, 2010; Campos et al., 2010). Corruption has direct and indirect negative effects on human development. First, corruption can affect human development by slowing economic growth, and second, it shifts government investment from basic sectors, such as health and education to non-productive sectors (Emara, 2020). On the other hand, proponents of the positive impact of corruption on the economy believe that corruption facilitates trade and can increase economic growth by stimulating entrepreneurship and productivity, and by helping the private sector to avoid a very deterrent regulatory environment (Palash, 2018). The hypothesis of the effect of human development on corruption is based on the fact that if citizens have a higher standard of living, life expectancy, and better education, they will be less prone to corruption. The level of human development may affect the level of corruption in a society because the general lack of awareness of political rights, and restrictions on access to the judiciary are likely to prevent the poor people from recognizing responsibility of politicians and government (Mazllami , 2019).
Methods
In order to investigate the impact of corruption on human development and in the short and long term, the Pooled Mean Group model (PMG) was used. The form of the error correction patterns will be as follows:
Wherein LCOR is the corruption control index introduced by the World Bank. The HDI Human Development Index was collected from the United Nations website. The LGDPP also represents the fixed GDP per capita in 2010, the data of which were collected from the World Bank. LG refers to the size of government (the ratio of government spending to GDP). This index is also collected from the World Bank. LTRADE, also a trade openness index obtained from the ratio of total exports and imports to GDP, compiled by the World Bank. βs represent the estimated coefficients in the long run, and
Finding
Table 1 estimation results
| Variable | HDI INDEX |
| (LGDP) | 1189/0 (8798/8) |
| (LG) | 0064/-0 (000/0) (2695/1-) |
| (LTRADE) | 0213/0 (3193/4) |
| (LCORWDI) | 0832/0 (7777/5) |
| (LHDI) | - |
| ECM | 2241/0- (1170/2-) |
| ∆LCOR | -0124/0 (8943/2-) |
| ∆ LG | 0068/0- (6451/0-) |
| ∆LGDPP | 0490/0 (3190/1) |
| ∆LTRADE | 0144/.0 (9140/1-) |
| ∆LHDI | - |
| C | 3362/0- (0510/2-) |
| Trend | 0008/0 (9510/0) |
Source: Research Findings, The numbers in parentheses represent the t-statistic.
Based on table 1, in the long run, the impact of corruption index on human development was positive. The impact of logarithm of GDP has positive impact on human development. The impact of logarithm of government consumption on human development were negative. However, the result of corruption index on human development was negative in short run. The impact of human development on corruption index was also negative in short run.
Discussion:
The effect of corruption control index, which means reduction of corruption, on human development index, is positive and significant in the long run. On the other hand, the effect of the corruption control index in the short run has been negative and statistically significant. In other words, in the short run, corruption has improved the status of the human development index. On the other hand, the impact of the Human Development Index on reducing corruption has been positive in the long run and negative in the short run. Therefore, it can be concluded that in the short term, due to corruption and bribery, people have been able to have better access to health services and education, and people have been able to achieve greater prosperity by circumventing strict and cumbersome laws. But in the long run, corruption has had a negative impact on the economic and infrastructure sectors, and appropriate policies need to be put in place to reduce corruption. On the other hand, the positive impact of human development in the long run on reducing corruption highlights the need to fight corruption. The negative impact of human development on reducing corruption in the short term can be due to the increase in the ability of individuals to pay bribes due to the improvement of the welfare of individuals and the lack of improvement of institutional quality in the short term with the improvement of human development.
Ethical considerations
Authors’ contributions
All authors contributed in producing of the research.
Funding
The present study did not have any sponsors.
Conflicts of interest
The authors declared no conflict of interest.
Following the ethics of research
In this article, all rights relating to references are cited and resources are carefully listed.
Type of Study: orginal |
Received: 2021/09/9 | Accepted: 2022/07/20 | Published: 2023/02/8
Received: 2021/09/9 | Accepted: 2022/07/20 | Published: 2023/02/8
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