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2012•RePEc: Research Papers in EconomicsRequires access

The Causal Relationship between Corruption and Poverty in ASEAN: a General Method of Moments/Dynamic Panel Data Analysis

Ina Purwantini Rahayu, Tri Widodo

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Abstract

This paper examines the Granger causal relationship between corruption and poverty with panel data of 9 ASEAN countries during the period of observation 2005-2009. It uses the generalized method of moments/dynamic panel data (GMM/DPD) and focuses on capability poverty using human development index (HDI). The major results show that poverty does not affect corruption meanwhile corruption causes poverty. There is unidirectional causality, from corruption to poverty.

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What this paper is about

This paper examines the Granger causal relationship between corruption and poverty with panel data of 9 ASEAN countries during the period of observation 2005-2009. It uses the generalized method of moments/dynamic panel data (GMM/DPD) and focuses on capability poverty using human development index (HDI). The major results show that poverty does not affect corruption meanwhile corruption causes poverty. There is unidirectional causality, from corruption to poverty.

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Available abstract

This paper examines the Granger causal relationship between corruption and poverty with panel data of 9 ASEAN countries during the period of observation 2005-2009. It uses the generalized method of moments/dynamic panel data (GMM/DPD) and focuses on capability poverty using human development index (HDI). The major results show that poverty does not affect corruption meanwhile corruption causes poverty. There is unidirectional causality, from corruption to poverty.

Key concepts: Poverty, Panel data, Generalized method of moments, Language change, Causality (physics), Economics, Econometrics, Granger causality

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