Corruption Effects on Nigeria: Aggregate and Sectoral Estimates Using VAR

Abstract

This research study investigates the impact of corruption on some key activity sectors of the Nigerian economy between 1996 and 2013 using VAR technique. The empirical estimates demonstrate that corruption affects most significantly agriculture, services, wholesale and retail sectors in Nigeria. As well, the study shows that the control of corruption has significant effect in the reduction of corruption. The study recommends that Nigeria can use an amalgamation of ethics hotlines for reporting corruption, open-door policies to embolden subordinates to consult with bosses for guidance, a "zero-tolerance" policy for breaches, anticorruption training sessions, and complete transparency in governmental operations to minimalize infractions. Nigeria will require strong political will and vision, credibility, frontal assault, new staff, deregulation, unconventional methods, close coordination, harnessing technology and tailoring international experience to local conditions.