The Impact of Corruption Through Treasury Looting on Economic Performance in Nigeria
Abstract
This study investigates the intricate relationship between revenue from treasury looting and economic performance in Nigeria spanning from 1990 to 2022. The Nigerian Bureau of Statistics and the Central Bank of Nigeria's Statistical Bulletin are two of the sources from which the study's secondary data were obtained. The findings of the study reveal several key insights. First, corruption through treasury looting exerts a significant negative impact on Nigeria's economic performance. Higher perceived corruption levels are associated with lower GDPGR, highlighting the adverse effects of corruption on economic development. Second, the study identifies a positive short-term relationship between the growth rate of reported looted funds (TLFN) and GDPGR. However, this effect may not be sustainable in the long run, and it raises concerns about the sources and implications of such funds on the economy. The practical implications of these findings underscore the imperative of anti-corruption efforts in Nigeria. Strengthening governance, enhancing transparency, and implementing effective anti-corruption measures are essential for promoting sustainable economic growth. While short-term economic boosts from looted funds may occur, they are not a viable strategy for long-term development and can undermine trust in the economy. This study contributes to the ongoing discourse on corruption and economic performance in Nigeria and gives policymakers, stakeholders and researchers insightful information. It emphasizes the need for sustained and comprehensive efforts to combat corruption and foster an environment conducive to economic prosperity in the country.
Keywords
Treasury lootingCorruptionEconomic performanceNigeriaGDP growthForeign
References
Acemoglu, D., & Robinson, J. A. (2006). Economic Origins of Dictatorship and Democracy. Cambridge University Press. Tullock, G. (1967). The Welfare Costs of Tariffs, Monopolies, and Theft. Western Economic Journal, 5(3), 224-232. Adegbite, E. (2018). Corruption and corporate governance in Nigeria: Perceptions, Deceptions and the Way Forward. Journal of Business Ethics, 162(3), 635-648. Adeyemi, K. S., & Ahmed, A. B. (2019). Corruption and economic growth in Nigeria: A time series analysis. Cogent Economics & Finance, 7(1), 1-16. Aigbokhan, B. E. (2000). Corruption and Economic Growth in Nigeria: 1986-1997. African Economic Research Consortium, Research Paper 107. Ajakaiye, O., & Nabena, D. (2003). Corruption, Political Instability and Economic Development in the Economic Community of West African States (ECOWAS): Is There a Causal Relationship? African Economic Research Consortium (AERC) Research Paper 130. Alao, D. (2016). Corruption in Nigeria: A Challenge to Sustainable Development in the Fourth Republic. Research Journal of Finance and Accounting, 7(5), 54-60. Aliyu, M. K. (2024). Treasury Looting and Carting Away of Government Property by State Governors in South Western, Nigeria. Mediterranean Journal of Social Sciences, 15(4), 46-62. Aliyu, M. M. (2024). Legal framework for fight against corrupt practices in Nigeria: An Analysis. Multidisciplinary Journal of Law, Education and Humanities, 1(2), 38-52. Asongu, S. A., & Nwachukwu, J. C. (2016). The Role of Governance in Mobile Phones for Inclusive Human Development in Sub-Saharan Africa. Technovation, 55-56, 1-13. Auty, R. M. (1993). Sustaining Development in Mineral Economies: The Resource Curse Thesis. Routledge. Ayobamiji, Y. A., & Okunade, A. A. (2020). The Nexus Between Corruption, Economic Growth, and Income Inequality in Nigeria. Social Indicators Research, 151(2), 747-766. Bardhan, P., & Mookherjee, D. (2006). Decentralization and Accountability in Infrastructure Delivery in Developing Countries. Economic Journal, 116(508), 101-127. Brooks, C. (2009). Introductory econometrics for finance (2nd ed.). Cambridge University Press. Campos, J. E., & Pradhan, S. (1996). The Dynamics of the Revenue-Maximizing Laffer Curve: Evidence from 66 Countries. The Economic Journal, 106(438), 471-482. Chete, L. N., Adeoti, J. O., & Adeyeye, V. A. (2011). Corruption and Economic Growth in Nigeria: An Empirical Investigation. The International Journal of Business and Finance Research, 5(2), 91-104. Chukwuma-Offor, A. M. (2023). Corruption and Nigeria Developmental Challenges: Insights from Exodus 23: 8. Interdisciplinary Journal of African & Asian Studies (IJAAS), 9(1), 1-9. Clarke, G. R. G., Zou, H., & Xu, L. (2003). Finance and income inequality: What do the data tell us? Southern Economic Journal, 69(4), 869-887. Dreher, A., & Herzfeld, T. (2005). The Economic Costs of Corruption: A Survey and New Evidence. Public Choice, 124(3-4), 271-292. Edame, G. E., & Asuquo, A. I. (2019). Corruption and Agricultural Productivity in Nigeria: An Empirical Analysis. Economies, 7(3), 95. Egwaikhide, F. O., & Oriakhi, D. E. (2000). Corruption and Economic Growth: Evidence from Nigeria. AERC Research Paper 105, African Economic Research Consortium. Egwutuoha, I. P., & Anyanwu, J. I. (2016). Does Corruption Matter for Economic Growth in Nigeria? Journal of Economics and Development Studies, 4(2), 46-61. Enyekit, E. V., & Okoye, L. U. (2018). Corruption and Sustainable Economic Development in Nigeria. International Journal of Economics, Commerce and Management, 6(4), 1-10. Ewubare, D. B., & Ebi, B. O. (2020). Corruption and Foreign Direct Investment in Nigeria: An Empirical Analysis. Heliyon, 6(10), e05291. Gupta, S., de Mello, L., & Sharan, R. (2002). Corruption and Military Spending. European Journal of Political Economy, 18(4), 717-721. Ikelegbe, A. (2006). The Economy of Conflict in the Oil Rich Niger Delta Region of Nigeria. Nordic Journal of African Studies, 15(2), 208-234. Isola, W. A., & Ekundayo, O. (2017). Corruption and Foreign Direct Investment: Evidence from Nigeria. International Journal of Economics, Commerce and Management, 5(7), 8-16. Iwarimie-Jaja, D. (2013). Corruption and Economic Growth in Nigeria: 1986-2010. African Development Review, 25(2), 189-202. Iyoha, F. O., & Oriakhi, D. E. (2010). Corruption and Economic Development of Nigeria: A Granger Causality Analysis. Journal of Economics and International Finance, 2(3), 047- Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3(4), 305-360. Khan, M. H. (1996). A Typology of Corrupt Transactions in Developing Countries. IDS Bulletin, 27(2), 12-21. Lambsdorff, J. G. (2006). Causes and Consequences of Corruption: What Do We Know from a Cross-Section of Countries? In T. Søreide (Ed.), Corruption and Development (pp. 27-55). Edward Elgar Publishing. Mauro, P. (1995). Corruption and Growth. The Quarterly Journal of Economics, 110(3), 681-712. Murtala, R. O. (2021). Corruption and Economic Growth in Nigeria: A Cointegration and Granger Causality Analysis. Journal of Economic Structures, 10(1), 1-16. North, D. C. (1990). Institutions, Institutional Change and Economic Performance. Cambridge University Press. Nye, J. S. (1967). Corruption and Political Development: A Cost-Benefit Analysis. American Political Science Review, 61(2), 417-427. Obi, C. (2019). Corruption and Development in Nigeria: A Review of the Literature. African Development Review, 31(2), 135-148. Obisesan, A. A., & Ogunrinola, I. O. (2020). Corruption, Political Instability and Economic Growth: Evidence from Nigeria. International Journal of Economics, Commerce and Management, 8(12), 38-49. Odeyemi, T. A., & Adelopo, I. (2018). Corruption, Political Stability and Economic Development in Nigeria. Journal of Economic and Administrative Sciences, 34(3), 193-210. Odusote, A., & Bello, B. (2024). The Matrixes of Bad Governance, Corruption and Insecurity in Nigeria. Journal of African Interdisciplinary Studies, 8(1), 21-45. Ogunmuyiwa, M. S. (2016). The Determinants of Corruption in Nigeria: A Political Economy Analysis. Journal of Economics and Sustainable Development, 7(4), 114-123. Okechukwu, E. K., Aderinto, A. O., & Lawal, S. B. (2024). Combating Corruption in Nigeria: A Case Study of Public Prosecution under Buhari’s Administration (2015-2023). African Journal of Stability & Development, 16(1), 40-72. https://doi.org/10.53982/ajsd.2024.1501.02-j Olatundun, F. A., & Efobi, U. R. (2018). Corruption and the Environmental Kuznets Curve in Nigeria: Empirical Evidence. Energy Reports, 4, 439-446. Olayiwola, M. A., Folorunsho, A., & Ayoade, S. D. (2024). Corruption as a challenge to sustainable development in Nigeria: 2015-2024. International Journal of Innovation Research and Advanced Studies. Olusoji, M. A., & Ayodeji, F. (2014). Corruption and Economic Growth in Nigeria: A Time Series Analysis. Journal of Economics and Sustainable Development, 5(10), 139-146. Oluwatobi, S., Efobi, U., & Osabuohien, E. S. (2014). Globalisation and Corruption: Evidence from Panel Data in Nigeria Osabuohien, E. S. (2007). Corruption and Human Development in Nigeria. The Journal of Socio- Economics, 36(5), 728-739. Oyegunle, A. O., & Adegbite, E. (2019). The Dynamics of Corruption and Economic Performance in Nigeria: A Structural Equation Modelling (SEM) Approach. Cogent Economics & Finance, 7(1), 1692089. Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3), 289-326. Premium Times. (2016). Arms Deal Scandal: How Nigerian Officials Stole $15 Billion Meant for Arms Procuremen
More Articles from IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH
Effect of Monetary Policy on Profitability of Deposit Money Banks in Nigeria
Author: Stephanie Nguhemen Gbande, Mike T. Soomiyol, Timothy Tyona, Gaius Msendoo Asombo
Examining the Impact of Corporate Social Responsibility on Financial Performance: Evidence from Small and Medium-Sized Enterprises in Hanoi
Author: Nguyen Mai Phuong
Cognitive Diversity and Performance of Deposit Money Banks in Nigeria
Author: 1Nwangwu, Okwudiri Iheanyi, 2 Pepple, Grace Jamie PhD
Banking Innovations and Industrial Sector Performance in Nigeria: Evidence from ARDL Model
Author: Peter Ngbede Ajam, Abiodun Edward Adelegan, Benson Emmanuel
Environmental Sustainability and Entrepreneurial Performance in Nigeria: A Case Study of Enugu State
Author: i, Azolike Nkiru Nkechi, ii, Okwor Emmanuel Ejimnkonye, iii, Eneaniofu Daniel Mmaduakonam