Control of Corruption and Economic Growth in Developing ASEAN Countries

Hady Sutjipto, Saharuddin Didu, Rah Adi Fahmi Ginanjar, Tony Santika Chendrawan and Andi Kustanto ()

Economic Thought journal, 2026, issue 2, 300-329

Abstract: Corruption reflects governance failure, which increases transaction costs, weakens regulatory certainty, and ultimately suppresses economic growth. This study analyses the effect of corruption control on economic growth in eight developing ASEAN countries from 2012 to 2024. Panel data econometric methods using fixed effects models with the Driscoll–Kraay standard errors (FE-DKSE) have been employed to estimate the effect, whilst feasible generalised least squares (FGLS) and panel-corrected standard errors (PCSE) are applied as robustness checks to validate the findings. The results consistently indicate that corruption control exerts a positive and significant effect on economic growth, operating through the strengthening of the investment climate, macroeconomic stability, and the effectiveness of public policies. These findings underscore the importance of prioritising anti-corruption reforms, strengthening the rule of law, improving human capital quality, and enhancing the productivity of public spending as central pillars of sustainable economic development in the region.

JEL-codes: H00 H11 O11 O47 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:bas:econth:y:2026:i:2:p:300-329

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