Corruption, Institutional Quality and Economic Performance in an Emerging Economy: Lessons from Nigeria

Abstract

The need to promote and sustain a virile economy has continued to be a major concern of most governments worldwide, including Nigeria. The reason for this is not farfetched. For instance, a developed economy offers prospects for increased employment, greater efficiency and improved balance of payments and increased standard of living. But in Nigeria, improved economic performance has over the years been marred by social vices such as institutionalized corruption which hinders the capacity of institutions to efficiently deliver services necessary to grow the economy. This paper descriptively and quantitatively examines how corruption and institutional quality in Nigeria have impacted on economic performance. In the light of the above, it was found that corruption and institutional quality (measured by contract intensive money) have statistically significant effect on economic performance in Nigeria. Thus, it is recommended that aggressive re-orientation and education of the masses and other key decision makers on the need to desist from rent-seeking activities is necessary. Once the scourge of corruption is successfully tackled, institutional quality will be strengthened and the much desired people centered economic growth will be achieved.