Determinants of Corruption in Developing Countries (Trade AND ECONOMIC Growth) (Report‪)‬

Corruption has two dimensions; public sector corruption and private sector corruption. This paper focuses on public sector corruption using cross-sectional data. For this purpose, 41 developing countries are analysed to explore the determinants of corruption. These determinants have been divided into economic and non-economic determinants. The economic determinants include economic freedom, distribution of income, level of development, and globalisation. The non-economic determinants consist of religion, democracy, and press freedom. The empirical findings of the study indicate that all economic determinants are negatively related to the perceived level of corruption, except distribution of income. The non-economic determinants do not significantly explain the variations in the level of corruption fully. This shows that the socio-political and religious norms are too weak to affect the corruption level among these countries. This implies that religion has a limited role in shaping the behaviour of people in general. Therefore, the perceived level of corruption is not affected by the religion. The upshot of the study is that the government should mainly focus on the economic factors to curtail the level of corruption. JEL classification: D01, H41