Analyzing the Impact of Corruption on Income Levels Disparity Between Countries

Abstract

The study aimed to analyze the impact of corruption on economic growth, for a sample of 131 countries, during the year 2018. Three indicators of corruption were used. The economic growth variable was an ordered variable that arranges the country’s income into four categories of income. A set of control variables was also used. The relationship between the variables was analyzed using Ordered Probit and Ordered Logit Models. Three model parameters were estimated using STATA software. The results of the study showed that the three indicators of corruption had a negative and significant impact on the income levels of the studied countries. The results also showed that each income level has specific threshold values for corruption indicators. The higher the level of corruption in a country than that threshold. The greater the need for an effective anti-corruption policy. And allocate more funding for its success.

Keywords

• corruption
• ethical behavior
• economic growth
• ordered probit models
• ordered logit models