Corruption and Economic Efficiency: Panel Data Evidence |
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Authors: | George Emm Halkos Nickolaos G. Tzeremes |
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Affiliation: | 1. Department of Economics , University of Thessaly , Korai 43, 38333, Volos, Greece halkos@econ.uth.gr;3. Department of Economics , University of Thessaly , Korai 43, 38333, Volos, Greece |
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Abstract: | Abstract This paper investigates empirically the effect of corruption on countries' economic efficiency. By using a sample of 79 countries for the time period 2000–2006 the paper applies DEA window analysis and econometric panel data techniques. The results reveal that there is a U-shaped relationship between countries' corruption perception levels and economic efficiency. Furthermore, it appears that corruption has a negative effect on countries' economic efficiency. For the first time the turning points of such a relationship are being produced indicating that on average terms and regardless of countries' economic structure, Corruption Perception Index (CPI) above five initiate a positive effect on a countries' economic efficiency. |
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Keywords: | Corruption Perception Index (CPI) economic efficiency generalized least squares DEA window analysis |
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