Do corruption and peace affect economic growth? Evidences from the cross-country analysis

This paper models the impact of corruption and peace on economic growth during the period of 2008–2012. The study is based on a cross-country analysis which focuses 126 countries. Corruption and peace were represented by Corruption Perception Index and Global Peace Index introduced by Transparency International and Institute for Economics and Peace, respectively. OLS estimates confirmed that corruption negatively affects the per capita economic growth, while peace stimulates the economic growth of the tested countries. These results are consistent with the previous studies, and the results also suggest that labour and financial crisis reduce the per capita economic growth though foreign direct investment boosts the economic growth. The current study recommends securing the good governance which reduces the level of corruption along with peaceful environment in order to ensure the steady economic growth.