The Role of Corruption Control in the Impact of Government Expenditure on Economic Growth (A Case Study: Selected OPEC Member Countries) (in Persian)

Maryam Gahramzehi, Gholamreza Zamanian () and Marziyeh Esfandiari ()
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Maryam Gahramzehi: University of Sistan and Baluchestan, Zahedan, Iran
Gholamreza Zamanian: University of Sistan and Baluchestan, Zahedan, Iran
Marziyeh Esfandiari: University of Sistan and Baluchestan, Zahedan, Iran

The Journal of Planning and Budgeting (٠صلنامه برنامه ریزی و بودجه), 2024, vol. 29, issue 3, 91-120

Abstract: Abstract The impact of government expenditure on economic growth has always been one of the most important elements in managing a country's affairs towards achieving desirable and sustainable economic growth. Corruption is a common phenomenon in countries with bloated governments. Given the role of natural resources in shaping corruption and rent-seeking behavior, controlling corruption is essential for selected OPEC member countries, as well as the impact of government expenditure on economic growth in these countries. Therefore, the present study aims to examine the role of corruption control in the impact of government expenditure on economic growth for selected OPEC member countries during the period 2002-2022, using annual data and employing the Generalized Method of Moments (GMM) and the Threshold Model by Hansen (1999). The findings indicate that government expenditure has a nonlinear effect on economic growth, meaning that the research model has a threshold for corruption control at a significant level of 95% with a value of -1.4622. The results show that at lower levels than the threshold variable (CC), government expenditure positively impacts economic growth. However, at higher levels than the threshold variable (CC), government expenditure has a negative impact on economic growth. Considering the magnitude of the corruption control index in selected OPEC member countries and the study results, implementing expansionary fiscal policies by governments is not recommended. Theoretically, these findings support the theory of "grease the wheels.

Keywords: : Economic growth; Government final consumption expenditure; Corruption control; Generalized Method of Moments (GMM); Panel Smooth Transition Regression (PSTR) (search for similar items in EconPapers)
JEL-codes: O13 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:auv:jipbud:v:29:y:2024:i:3:p:91-120

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