Corruption, nonperforming loans, and economic growth: International evidence
This paper explores the impact of corruption on both the banking sector and economic growth; we determine the impact using aggregate data from the World Bank covering 120 countries over the period 2004–2017. The results of 3SLS regressions show that the relationship between corruption and the ratio...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2020-01-01
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| Series: | Cogent Business & Management |
| Subjects: | |
| Online Access: | http://dx.doi.org/10.1080/23311975.2020.1735691 |
| _version_ | 1818683206191284224 |
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| author | Tran Hung Son Nguyen Thanh Liem Nguyen Vinh Khuong |
| author_facet | Tran Hung Son Nguyen Thanh Liem Nguyen Vinh Khuong |
| author_sort | Tran Hung Son |
| collection | DOAJ |
| description | This paper explores the impact of corruption on both the banking sector and economic growth; we determine the impact using aggregate data from the World Bank covering 120 countries over the period 2004–2017. The results of 3SLS regressions show that the relationship between corruption and the ratio of nonperforming loans was positive, thus deteriorating the soundness of the banking system. In this study, we also find evidence that banking system is a channel that transfers the impact of corruption on economic growth: Corruption leads to higher levels of nonperforming loans in the banking sector; as a result, it decreases economic growth. The findings survive a battery of robustness tests, including alternative corruption measurement and System Generalized Method of Moments regression for dynamic models with an interaction term. |
| first_indexed | 2024-12-17T10:31:03Z |
| format | Article |
| id | doaj.art-321373ffa44a4a5daf00d8025b1e2a5c |
| institution | Directory Open Access Journal |
| issn | 2331-1975 |
| language | English |
| last_indexed | 2024-12-17T10:31:03Z |
| publishDate | 2020-01-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Business & Management |
| spelling | doaj.art-321373ffa44a4a5daf00d8025b1e2a5c2022-12-21T21:52:30ZengTaylor & Francis GroupCogent Business & Management2331-19752020-01-017110.1080/23311975.2020.17356911735691Corruption, nonperforming loans, and economic growth: International evidenceTran Hung Son0Nguyen Thanh Liem1Nguyen Vinh Khuong2University of Economics and LawUniversity of Economics and LawUniversity of Economics and LawThis paper explores the impact of corruption on both the banking sector and economic growth; we determine the impact using aggregate data from the World Bank covering 120 countries over the period 2004–2017. The results of 3SLS regressions show that the relationship between corruption and the ratio of nonperforming loans was positive, thus deteriorating the soundness of the banking system. In this study, we also find evidence that banking system is a channel that transfers the impact of corruption on economic growth: Corruption leads to higher levels of nonperforming loans in the banking sector; as a result, it decreases economic growth. The findings survive a battery of robustness tests, including alternative corruption measurement and System Generalized Method of Moments regression for dynamic models with an interaction term.http://dx.doi.org/10.1080/23311975.2020.1735691corruptionnonperforming loansbankingeconomic growth3sls |
| spellingShingle | Tran Hung Son Nguyen Thanh Liem Nguyen Vinh Khuong Corruption, nonperforming loans, and economic growth: International evidence Cogent Business & Management corruption nonperforming loans banking economic growth 3sls |
| title | Corruption, nonperforming loans, and economic growth: International evidence |
| title_full | Corruption, nonperforming loans, and economic growth: International evidence |
| title_fullStr | Corruption, nonperforming loans, and economic growth: International evidence |
| title_full_unstemmed | Corruption, nonperforming loans, and economic growth: International evidence |
| title_short | Corruption, nonperforming loans, and economic growth: International evidence |
| title_sort | corruption nonperforming loans and economic growth international evidence |
| topic | corruption nonperforming loans banking economic growth 3sls |
| url | http://dx.doi.org/10.1080/23311975.2020.1735691 |
| work_keys_str_mv | AT tranhungson corruptionnonperformingloansandeconomicgrowthinternationalevidence AT nguyenthanhliem corruptionnonperformingloansandeconomicgrowthinternationalevidence AT nguyenvinhkhuong corruptionnonperformingloansandeconomicgrowthinternationalevidence |