Public Debt, Corruption Control and Economic Development in Ecowas Countries
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Abstract
This paper examines the effects of public debt on economic development when mediating with corruption control in the ECOWAS states. This paper’s primary goal is to evaluate if corruption control moderates the effect of domestic debt on real GDP in ECOWAS countries, empirically evaluate that impact and offer appropriate policy recommendations. This paper uses secondary panel data from the World Development Indicators (WDI), African Development Bank (AfDB), and World Governance Indicators (WGI) spanning the period 1996-2022 for ECOWAS members’ states. This study used real gross domestic product (GDP) and domestic debt as explained and explanatory variables, respectively, while corruption control serves as the moderating variable. The PARDL result shows that that there is evidence of both short and long-run symmetric relationship between domestic debt and real GDP with and without corruption control. However, the effect is better pronounced when corruption is controlled. Comparatively, domestic debt has positive and negative nexus with real GDP in the short- and long-run, respectively, while corruption control maintains a significant positive association in the short- and long-run. Finally, the study concluded by underscoring the pivotal role of domestic debts on real GDP in ECOWAS countries by further control of corruption is necessary for strengthening economic development.
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