Determinants of corruption in Nigeria: evidence from various estimation techniques

Abstract

Reducing corruption has been one major challenge facing government and policy makers in Nigeria. This study employs the ARDL, CCR and FMOLS methods to assess the determinants of corruption in Nigeria over the period 1984–2016. The result of the cointegration test indicates that corruption and its determinants (economic development, political rights, military expenditure, rents, civil liberties and openness) have a long-run relationship. The results of the ARDL, CCR and FMOLS estimation demonstrate that economic development, political rights, military expenditure, rents, civil liberties and openness, are the main determinants of corruption in the long-run. Higher-economic development, greater civil liberties, more openness and higher military expenditure are related to lower corruption, but higher rents and political rights are associated with higher corruption. Based on these outcomes, this study recommends policies to promote economic development, civil liberties, political rights and openness, including reducing the reliance on the oil sector to curb corruption in Nigeria.