Institutional Corruption and Economic performance Nexus: An Empirical analysis with evidence from Nigeria

Abstract

Corruption has emerged as a multifaceted challenge severely impacting the Nigerian economy in recent times. The impetus behind this study stems from the recognition that no sector, whether private, public, local or traditional institution can claim to be free from corruption. The primary objective is to examine the potential repercussions of institutional corruption on the productive performance of the Nigerian economy. Employing the Ordinary Least Squares (OLS) methodology and rooted in the endogenous growth theory, the study underscores that corruption is a hindrance to economic performance in Nigeria, as supported by evidence-based research and documented cases of corrupt practices in the country.

In summary, the comprehensive view reveals that corruption detrimentally affects Nigeria's economic performance in various aspects. The study concludes that the effect of corruption on the productive performance of Nigeria is alarming and has manifested adverse consequences for the economy and if Nigeria fails to combat corruption, the nation risks facing dire consequences due to its pervasive presence. The policy recommendations emphasized that the Nigeria government should streamline and harmonize all forms of monetary transactions and payments in the country using the treasury single account (TSA), National identification number (NIN), the bank verification number (BVN) and all forms of electronic payment systems into a single digital platform and link such digital platform with the various anti-graft agencies for periodic monitoring. This will drastically reduce corruption and transactions with physical cash. Secondly, the Nigerian government should to demonstrate the political will to prosecute individuals involved in corrupt practices, regardless of their tribe, religion, or political affiliation. Such stringent actions are crucial as deterrents for others. These findings align with the ongoing institutional restructuring agenda widely advocated in Nigeria.