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DETERMINISTIC EFFECT FOREIGN DIRECT INVESTMENT ON CORRUPTION: A PANEL DATA ANALYSIS FOR MENA REGION

Year 2018, Prof. Dr. Harun TERZI Special Issue, 287 - 302, 19.09.2018
https://doi.org/10.18092/ulikidince.445887

Abstract

The
Middle East and North Africa (MENA) region are generally consist of rentier
economies of potential holding corruption and similar negative effects on
political, social, legal, administrative, commercial and many other individual
or institutional behaviors. On the other hand, the MENA are in need of foreign direct
investments (FDI) in the way of economic development. Empirical studies have
assessed the phenomenon of corruption as a decisive factor influencing the
decisions of individual investors, and FDI-corruption relations is often
explored from this perspective. In this study, the influence of FDI inflows on
the control of corruption was investigated by System GMM analysis method for
the period of 1996-2016 in MENA, and under the data conditions it was found
that the FDI inflows had a negative and significant effect on the control of
corruption. This is explained by the constraints of political and social
institutions, especially in the "traditional" and "closed"
structures in the countries of the region.

References

  • Abbas, S. ve El Mosallamy, D. (2016), Determinants of FDI Flows to Developing Countries: An Empirical Study on the MENA Region. Journal of Finance and Economics 4(1), 30-38.
  • Abed, G. T. ve Davoodi, H. R. (2000), Corruption, Economic Reforms, and Economic Performance in the Transition Economies. IMF Working Paper, No: 00/132.
  • Ades, A. ve Di Tella, R. (1997), The New Economics of Corruption: A Survey and Some New Results. Political Studies 45(3), 496-515.
  • Ades, A. ve Di Tella, R. (1999), Rents, Competition, and Corruption. The American Economic Review 89(4), 982-993.
  • Ackerman, J. (2004). Co-Governance for Accountability: Beyond Exit and Voice. World Development 32(3), 447-463.
  • Akçay, S. (2006), Corruption and Human Development. Cato Journal 26(1), 29-48.
  • Al-Sadig, A. (2009), The Effects of Corruption on FDI Inflows. Cato Journal 29(2), 267-294.
  • Arellano, M. ve Bond, S. (1991), Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations. The Review of Economic Studies 58(2), 277-297.
  • Arellano, M. ve Bover, O. (1995), Another Look at the Instrumental Variable Estimation of Error-Components Models. Journal of Econometrics 68(1), 29-51.
  • Bardhan P. (1997), Corruption and Development: A Review of Issues. Journal of Economic Literature 35(3), 1320-1346.
  • Billger ve Goel (2009), Do Existing Corruption Levels Matter in Controlling Corruption? Cross Country Quantile Regression Estimates. Journal of Development Economics 90, 299-305.
  • Blundell, R. ve Bond, S. (1998), Initial Conditions and Moment Restrictions in Dynamic Panel Data Models. Journal of Econometrics 87(1), 115-143.
  • Brouthers, L. E. ve Gao, Y. ve McNicol, J. P. (2008), Corruption and Market Attractiveness Influences on Different Types of FDI. Strategic Management Journal 29(6), 673-680.
  • Chêne, M. (2007), Overview of Corruption in MENA Countries. Transperancy Internatiınal Anti Corruption Research Center, https://www.u4.no/publications/overview-of-corruption-inmena-countries.pdf, erişim: 12.03.2018. Craigwell, R. ve Wright, A. (2011), Foreign Direct Investment and Corruption in Developing Economies: Evidence from Linear and Non-linear Panel Granger Causality Tests. Economics Bulletin 31(3), 2272-2283.
  • De Jong, E ve Bogmans, C. (2011), Does Corruption Discourage International Trade?. European Journal of Political Economy 27(2), 385-398.
  • Elbahnasawy, N. G. ve Revier, C. F. (2012), The Determinants of Corruption: Cross‐Country‐Panel‐Data Analysis. The Developing Economics 50(4), 311-333.Everhart, S. S., Martinez-Vazquez, J. ve McNab, R. M. (2009), Corruption, Governance, Investment and Growth in Emerging Markets. Applied Economics 41, 1579-1594.
  • Goel, R. K. ve Nelson, M. A. (2009), Corruption in MENA Countries: An Empirical Investigation.Economic Perfoemance in the Middle East and North Africa - Institutions, Corruption and Re-form. Serdar Sayan (ed.), New York: Routledge, 13-24.
  • Goel, R. K. ve Nelson, M. A. (2010), Causes of Corruption: History, Geography and Government. Journal of Policy Modeling 32(4), 433-447.
  • Gray, C. W. ve Kaufman, D. (1998), Corruption and Development. Finance & Development 35(1), 7-10.
  • Habib, M. ve Zurawicki, L. (2002), Corruption and Foreign Direct Investment. Journal of International Business Studies 33(2), 291-307.
  • Helmy, H. E. (2013), The Impact of Corruption on FDI: Is MENA an Exception?. International Reviewof Applied Economics 27(4), 491-514.
  • Hines, J. R. (1995), Forbidden Payment: Foreign Bribery and American Business After 1977. NBER Working Paper, No: 5266.
  • Iqbal, F. ve Nabli, M. K. (2004), Trade, Foreign Direct investment and Development in the Middle East and North Africa. The Middle East and North Africa Region: The Challenges of Growth and Globalization, Washington DC: IMF, 7-8 April 2004.
  • Kegley, C. W. ve Blanton, S. H. (2015). Dünya Siyaseti - Yönelim ve Dönüşüm, H. A. Gessler (çev.), Sakara: Sakarya Üniversitesi Kültür Yayınları.
  • Knack, S. ve Keefer, P. (1995), Institutions and Economic Performance: Cross-Country Test Using Alternative Institutional Measures. Economics and Politics 7(3), 207-227.
  • Kotera, G. ve Okada, K. ve Samreth, S. (2012), Government Size, Democracy, and Corruption: An Empirical Investigation. Economic Modelling 29(6), 2340-2348.
  • Kutan, A. M., Douglas, T. J. ve Judge, W. Q. (2009), Does Corruption Hurt Economic Development? Evidence from Middle Eastern-North African and Latin American Countries. Economic Performance in the Middle East and North Africa - Institutions, Corruption and Reform, Serdar Sayan (ed.), New York: Routledge, 25-37.
  • Kwok, C. ve Tadesse, S. (2006), The MNCs as an Agent of Change for Host-Country Institutions: FDI and Corruption. William Davidson Institute Working Paper, No: 882.
  • Larrain B., Felipe ve Tavares, José (2004), Does Foreign Direct Investment Decrease Corruption. Cuadernos De Economia 41, 217-230.
  • Leite ve Weidmann (1999), Does Mother Nature Corrupt? Natural Resources, Corruption, and Economic Growth. IMF Working Paper, No: 99/85.
  • Lipsey, R. E. (2002), Home and Host Country Effects of FDI. National Bureau of Economic Research Working Paper, No: 9293.
  • Mathur, A. ve Singh, K. (2013), Foreign Direct Investment, Corruption and Democracy, Applied Economics 45(8), 991-1002.
  • Miller, T. ve Kim, A. B. (2014), Defining Economic Freedom. Index of Economic Freedom 2014. The Heritage Foundation and The Wall Street Journal (Dow Jones&Company, Inc) Report, Terry Miller ve Diğerleri (Ed.), 57-62.
  • Mocan, N. (2009), Corruption, Corruption Perception and Economic Growth. Economic Performance in the Middle East and North Africa - Institutions, Corruption and Reform, Serdar Sayan (ed.), New York: Routledge, 38-66.
  • Mauro, P. (1995), Corruption and Growth. Quarterly Journal of Economics 110, 681-712.
  • Mauro P. (1997), Why Worry about Corruption?. IMF Economic Issues, No: 6.
  • OECD (2002), Foreign Direct Investment for Development - Maximising Benefits, Minimising Costs, Paris: OECD Publications Service.
  • OECD (2003), Public Sector Transperancy and the International Investors, Paris: OECD Publications Service.
  • OECD (2008a), The Social Impact of Foreign Direct Investment, OECD Policy Brief.
  • OECD (2008b), OECD Benchmark Definition of Foreign Direct Investment (4. Baskı).
  • Onyeiwu, S. (2004), Analysis of FDI Flows in Developing Countries: Is the MENA Region Different?. Published Working Paper from the Tenth Annual Conference of the Economic Research Forum, Cairo, http://www.mafhoum.com/press6/172 E11.pdf, erişim: 26.03.2018.
  • Paldam, M. (2002), The Cross-Country Pattern of Corruption: Economics, Culture and the Seesaw Dynamics, European Journal of Political Economy 18(2), 215-240.
  • Pinto, P. M. ve Zhu, B. (2016), Fortune or Evil? The Effect of Inward Foreign Direct Investment on Corruption. International Studies Quarterly 60(4), 693-705.
  • Rauch, J. E. ve Evans, P. B. (2000), Bureaucratic Structure and Bureaucratic Performance in Less Developed Countries, Journal of Public Economics 75(1), 49-71.
  • Roodman, D. (2009), How to Do xtabond2: An Introduction to Difference and System GMM in Stata, Stata Journal 9(1), 86-136.
  • Saha, S. ve Ben Ali, M. S. (2017), Corruption and Economic Development: New Evidence of Middle Eastern and Nort African Countries. Economic Analysis and Policy 54, 83-95.
  • Saygın, E. (2017), Ortadoğu’da Kalkınmanın Finansmanı. İstanbul: Pınar Yayınları.
  • Shleifer, A. ve Vishny, R. W. (1993), Corruption. The Quarterly Journal of Economics 108(3), 599-617.
  • Swamy, A., Knack, S., Lee, Y. ve Azfar, O. (2001), Gender and Corruption. Journal of Development Economics 64(1), 25-55.
  • Tanzi, V. ve Davoodi, H. R. (2000), Corruption, Growth, and Public Finances. IMF Working Paper, No: 00/182.Transperancy International (2006), Global Corruption Report 2006. Cambridge: Cambridge Universtiy Press.
  • Transperancy International (2009), Corruption in the MENA Region. TI Working Paper, No: 02/2009.
  • UNCTAD (2018), World Investment Report 2018-Investment and New Industral Policies. Geneva: United Nations Publications.
  • World Bank (1997), World Development Report 1997 - The State in a Changing World, New York: Oxford University Press.
  • World Bank (2017), Doing Business 2017, Washington D.C.
  • World Economic Forum (2017), The Global Competitiveness Report 2016-2017, Klaus Schwab (ed.), Geneva.

DOĞRUDAN YABANCI SERMAYE YATIRIMLARININ YOLSUZLUK ÜZERİNDEKİ BELİRLEYİCİ ETKİSİ: MENA BÖLGESİ İÇİN PANEL VERİ ARAŞTIRMASI

Year 2018, Prof. Dr. Harun TERZI Special Issue, 287 - 302, 19.09.2018
https://doi.org/10.18092/ulikidince.445887

Abstract

Ortadoğu
ve Kuzey Afrika (MENA) bölgesi genel olarak siyasal, toplumsal, hukuki, idari,
ticari ve diğer birçok alandaki bireysel ya da kurumsal davranışlar üzerinde
yolsuzluk ve benzeri olumsuz/bozucu nitelikte etkiler doğurma potansiyeli
barındıran rantiyer ekonomilerden oluşmaktadır. Diğer yandan MENA, iktisadi
kalkınma yolunda doğrudan yabancı sermaye yatırımlarına (DYSY) oldukça fazla
ihtiyaç duymaktadır. Literatürdeki araştırmalar yolsuzluk olgusunu yabancı
yatırımcıların kararlarına etki eden belirleyici bir faktör olarak
değerlendirmekte ve DYSY-yolsuzluk ilişkisi çoğunlukla bu yönden
irdelenmektedir. Bu çalışmada, literatürün aksine DYSY girişlerinin yolsuzluğun
kontrolü üzerindeki etkisi 1996-2016 dönemi için MENA bölgesi özelinde Sistem
GMM analizi yöntemiyle araştırılmış ve veri şartlar altında doğrudan yabancı
sermaye akımı girişlerinin yolsuzluğun kontrolü üzerinde negatif ve anlamlı bir
etkisinin bulunduğu tespit edilmiştir. Bu durum bölge ülkelerinde “geleneksel”
ve “kapalı” yapılardan beslenen özellikle politik ve toplumsal kurumların
kısıtlayıcılığı ile açıklanmaktadır. 

References

  • Abbas, S. ve El Mosallamy, D. (2016), Determinants of FDI Flows to Developing Countries: An Empirical Study on the MENA Region. Journal of Finance and Economics 4(1), 30-38.
  • Abed, G. T. ve Davoodi, H. R. (2000), Corruption, Economic Reforms, and Economic Performance in the Transition Economies. IMF Working Paper, No: 00/132.
  • Ades, A. ve Di Tella, R. (1997), The New Economics of Corruption: A Survey and Some New Results. Political Studies 45(3), 496-515.
  • Ades, A. ve Di Tella, R. (1999), Rents, Competition, and Corruption. The American Economic Review 89(4), 982-993.
  • Ackerman, J. (2004). Co-Governance for Accountability: Beyond Exit and Voice. World Development 32(3), 447-463.
  • Akçay, S. (2006), Corruption and Human Development. Cato Journal 26(1), 29-48.
  • Al-Sadig, A. (2009), The Effects of Corruption on FDI Inflows. Cato Journal 29(2), 267-294.
  • Arellano, M. ve Bond, S. (1991), Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations. The Review of Economic Studies 58(2), 277-297.
  • Arellano, M. ve Bover, O. (1995), Another Look at the Instrumental Variable Estimation of Error-Components Models. Journal of Econometrics 68(1), 29-51.
  • Bardhan P. (1997), Corruption and Development: A Review of Issues. Journal of Economic Literature 35(3), 1320-1346.
  • Billger ve Goel (2009), Do Existing Corruption Levels Matter in Controlling Corruption? Cross Country Quantile Regression Estimates. Journal of Development Economics 90, 299-305.
  • Blundell, R. ve Bond, S. (1998), Initial Conditions and Moment Restrictions in Dynamic Panel Data Models. Journal of Econometrics 87(1), 115-143.
  • Brouthers, L. E. ve Gao, Y. ve McNicol, J. P. (2008), Corruption and Market Attractiveness Influences on Different Types of FDI. Strategic Management Journal 29(6), 673-680.
  • Chêne, M. (2007), Overview of Corruption in MENA Countries. Transperancy Internatiınal Anti Corruption Research Center, https://www.u4.no/publications/overview-of-corruption-inmena-countries.pdf, erişim: 12.03.2018. Craigwell, R. ve Wright, A. (2011), Foreign Direct Investment and Corruption in Developing Economies: Evidence from Linear and Non-linear Panel Granger Causality Tests. Economics Bulletin 31(3), 2272-2283.
  • De Jong, E ve Bogmans, C. (2011), Does Corruption Discourage International Trade?. European Journal of Political Economy 27(2), 385-398.
  • Elbahnasawy, N. G. ve Revier, C. F. (2012), The Determinants of Corruption: Cross‐Country‐Panel‐Data Analysis. The Developing Economics 50(4), 311-333.Everhart, S. S., Martinez-Vazquez, J. ve McNab, R. M. (2009), Corruption, Governance, Investment and Growth in Emerging Markets. Applied Economics 41, 1579-1594.
  • Goel, R. K. ve Nelson, M. A. (2009), Corruption in MENA Countries: An Empirical Investigation.Economic Perfoemance in the Middle East and North Africa - Institutions, Corruption and Re-form. Serdar Sayan (ed.), New York: Routledge, 13-24.
  • Goel, R. K. ve Nelson, M. A. (2010), Causes of Corruption: History, Geography and Government. Journal of Policy Modeling 32(4), 433-447.
  • Gray, C. W. ve Kaufman, D. (1998), Corruption and Development. Finance & Development 35(1), 7-10.
  • Habib, M. ve Zurawicki, L. (2002), Corruption and Foreign Direct Investment. Journal of International Business Studies 33(2), 291-307.
  • Helmy, H. E. (2013), The Impact of Corruption on FDI: Is MENA an Exception?. International Reviewof Applied Economics 27(4), 491-514.
  • Hines, J. R. (1995), Forbidden Payment: Foreign Bribery and American Business After 1977. NBER Working Paper, No: 5266.
  • Iqbal, F. ve Nabli, M. K. (2004), Trade, Foreign Direct investment and Development in the Middle East and North Africa. The Middle East and North Africa Region: The Challenges of Growth and Globalization, Washington DC: IMF, 7-8 April 2004.
  • Kegley, C. W. ve Blanton, S. H. (2015). Dünya Siyaseti - Yönelim ve Dönüşüm, H. A. Gessler (çev.), Sakara: Sakarya Üniversitesi Kültür Yayınları.
  • Knack, S. ve Keefer, P. (1995), Institutions and Economic Performance: Cross-Country Test Using Alternative Institutional Measures. Economics and Politics 7(3), 207-227.
  • Kotera, G. ve Okada, K. ve Samreth, S. (2012), Government Size, Democracy, and Corruption: An Empirical Investigation. Economic Modelling 29(6), 2340-2348.
  • Kutan, A. M., Douglas, T. J. ve Judge, W. Q. (2009), Does Corruption Hurt Economic Development? Evidence from Middle Eastern-North African and Latin American Countries. Economic Performance in the Middle East and North Africa - Institutions, Corruption and Reform, Serdar Sayan (ed.), New York: Routledge, 25-37.
  • Kwok, C. ve Tadesse, S. (2006), The MNCs as an Agent of Change for Host-Country Institutions: FDI and Corruption. William Davidson Institute Working Paper, No: 882.
  • Larrain B., Felipe ve Tavares, José (2004), Does Foreign Direct Investment Decrease Corruption. Cuadernos De Economia 41, 217-230.
  • Leite ve Weidmann (1999), Does Mother Nature Corrupt? Natural Resources, Corruption, and Economic Growth. IMF Working Paper, No: 99/85.
  • Lipsey, R. E. (2002), Home and Host Country Effects of FDI. National Bureau of Economic Research Working Paper, No: 9293.
  • Mathur, A. ve Singh, K. (2013), Foreign Direct Investment, Corruption and Democracy, Applied Economics 45(8), 991-1002.
  • Miller, T. ve Kim, A. B. (2014), Defining Economic Freedom. Index of Economic Freedom 2014. The Heritage Foundation and The Wall Street Journal (Dow Jones&Company, Inc) Report, Terry Miller ve Diğerleri (Ed.), 57-62.
  • Mocan, N. (2009), Corruption, Corruption Perception and Economic Growth. Economic Performance in the Middle East and North Africa - Institutions, Corruption and Reform, Serdar Sayan (ed.), New York: Routledge, 38-66.
  • Mauro, P. (1995), Corruption and Growth. Quarterly Journal of Economics 110, 681-712.
  • Mauro P. (1997), Why Worry about Corruption?. IMF Economic Issues, No: 6.
  • OECD (2002), Foreign Direct Investment for Development - Maximising Benefits, Minimising Costs, Paris: OECD Publications Service.
  • OECD (2003), Public Sector Transperancy and the International Investors, Paris: OECD Publications Service.
  • OECD (2008a), The Social Impact of Foreign Direct Investment, OECD Policy Brief.
  • OECD (2008b), OECD Benchmark Definition of Foreign Direct Investment (4. Baskı).
  • Onyeiwu, S. (2004), Analysis of FDI Flows in Developing Countries: Is the MENA Region Different?. Published Working Paper from the Tenth Annual Conference of the Economic Research Forum, Cairo, http://www.mafhoum.com/press6/172 E11.pdf, erişim: 26.03.2018.
  • Paldam, M. (2002), The Cross-Country Pattern of Corruption: Economics, Culture and the Seesaw Dynamics, European Journal of Political Economy 18(2), 215-240.
  • Pinto, P. M. ve Zhu, B. (2016), Fortune or Evil? The Effect of Inward Foreign Direct Investment on Corruption. International Studies Quarterly 60(4), 693-705.
  • Rauch, J. E. ve Evans, P. B. (2000), Bureaucratic Structure and Bureaucratic Performance in Less Developed Countries, Journal of Public Economics 75(1), 49-71.
  • Roodman, D. (2009), How to Do xtabond2: An Introduction to Difference and System GMM in Stata, Stata Journal 9(1), 86-136.
  • Saha, S. ve Ben Ali, M. S. (2017), Corruption and Economic Development: New Evidence of Middle Eastern and Nort African Countries. Economic Analysis and Policy 54, 83-95.
  • Saygın, E. (2017), Ortadoğu’da Kalkınmanın Finansmanı. İstanbul: Pınar Yayınları.
  • Shleifer, A. ve Vishny, R. W. (1993), Corruption. The Quarterly Journal of Economics 108(3), 599-617.
  • Swamy, A., Knack, S., Lee, Y. ve Azfar, O. (2001), Gender and Corruption. Journal of Development Economics 64(1), 25-55.
  • Tanzi, V. ve Davoodi, H. R. (2000), Corruption, Growth, and Public Finances. IMF Working Paper, No: 00/182.Transperancy International (2006), Global Corruption Report 2006. Cambridge: Cambridge Universtiy Press.
  • Transperancy International (2009), Corruption in the MENA Region. TI Working Paper, No: 02/2009.
  • UNCTAD (2018), World Investment Report 2018-Investment and New Industral Policies. Geneva: United Nations Publications.
  • World Bank (1997), World Development Report 1997 - The State in a Changing World, New York: Oxford University Press.
  • World Bank (2017), Doing Business 2017, Washington D.C.
  • World Economic Forum (2017), The Global Competitiveness Report 2016-2017, Klaus Schwab (ed.), Geneva.
There are 55 citations in total.

Details

Primary Language Turkish
Journal Section Articles
Authors

Adem Gök 0000-0002-3786-2507

Tahsin Yamak 0000-0001-8831-7448

Emre Saygın 0000-0003-2939-1562

Publication Date September 19, 2018
Published in Issue Year 2018 Prof. Dr. Harun TERZI Special Issue

Cite

APA Gök, A., Yamak, T., & Saygın, E. (2018). DOĞRUDAN YABANCI SERMAYE YATIRIMLARININ YOLSUZLUK ÜZERİNDEKİ BELİRLEYİCİ ETKİSİ: MENA BÖLGESİ İÇİN PANEL VERİ ARAŞTIRMASI. Uluslararası İktisadi Ve İdari İncelemeler Dergisi287-302. https://doi.org/10.18092/ulikidince.445887

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