Democratic Government, Corruption Control, and Economic Development: Evidence from Nigeria with Cointegration Approach

Temitope Ajayi

MPRA Paper from University Library of Munich, Germany

Abstract: Nigeria returned to a democratic government in 1999. Evidence in the literature shows that democracy promotes economic development. In the recent past, the democratic trajectory of Nigeria has led to empirical debates about the democratization process of the developing states in particular, which is prone to multifaceted challenges. This study examines the impact of democratic government on Nigerian economic development using the VAR autoregressive approach. Our empirical work suggests that democracy has a long-run relationship with the economic development of Nigeria. Against our a priori expectations and established positions in some segments of the literature, this study identifies a negative impact of democracy on the economic development of Nigeria within our study period. On the other hand, the quality of the rule of law positively impacts economic development in Nigeria. Furthermore, the study finds a positive impact of corruption control in Nigeria with economic development, although observable evidence shows that the Nigerian government’s anti-corruption institution is weak. This research paper recommends institutional reforms for the democratization process of Nigeria to fully harness one of the most significant dividends of democracy-economic development.

Keywords: Nigeria; Democracy; Development; Corruption; Cointegration. (search for similar items in EconPapers)
JEL-codes: H1 H11 H12 H7 H77 K0 K2 K22 K4 K42 O1 O11 O43 O47 P5 P52 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-law
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Published in European Journal of Business and Management 15.13(2021): pp. 1-12

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:110090

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