Understanding corruption in India: determinants, nonlinear dynamics and policy implications
Abstract
Purpose
The purpose of this research is to evaluate corruption in the context of India, spanning the period between 1988 and 2021. Additionally, it aims to provide an in-depth comprehension of the factors that drive its prevalence and to propose policy directives for addressing these underlying issues.
Design/methodology/approach
The study instead of relying on perception-based measures, takes a distinct approach by formulating a corruption index derived from reported instances, thus ensuring a more objective assessment. Furthermore, we employ stochastic frontier analysis to tackle the issue of under-reporting within the corruption index based on reported cases. Subsequently, an auto regressive distributed lag (ARDL) methodology is applied to ascertain the principal drivers of corruption, encompassing both long and short factors.
Findings
This study reveals that corruption in India is notably influenced by economic growth and income inequality. Conversely, government effectiveness and globalization display a tendency to mitigate corruption. However, our rigorous analysis demonstrates that financial development does not wield a substantial influence in our study. Moreover, our inquiry uncovers a nonlinear relationship between economic growth and corruption. Additionally, we ascertain that the long run and short run impacts of corruption remain relatively stable across both models utilized in our study.
Originality/value
This study differs from previous research in the subsequent manners. Primarily, we employed an objective measure to formulate the corruption index, coupled with addressing the underreporting issues via stochastic frontier analysis. Moreover, this study pioneers the identification of a non-linear relationship between corruption and economic growth within the Indian context, a facet unexplored in previous investigations.
Keywords
Acknowledgements
The authors would like to thank the reviewers for their insightful comments and suggestions that greatly improved this manuscript. The authors also thank the journal's editor and associate editor for all of their crucial help and support.
Funding: This work is not associated with any funding.
Citation
Shaurav, K., Deheri, A. and Rath, B.N. (2024), "Understanding corruption in India: determinants, nonlinear dynamics and policy implications", International Journal of Emerging Markets, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJOEM-08-2023-1273
Publisher
:Emerald Publishing Limited
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