|
Abstract:
|
Corruption has attracted the attention of national governments and international organizations since the end of the cold war. The collapse of the Soviet Union shifted the destination of donations and aid from making and keeping alliances to democratization and development. This new trend increased the efforts by policy makers and policy analysts to measure corruption and quantitatively analyze its causes and consequences. This research contributes the literature on corruption by analyzing corruption's impact on the amount of money that governments spend on the military and education. It differs from earlier studies of the questions by using more recent data, using more observations, and by including different explanatory variables to overcome the problems of omitted variable bias and small sample sizes. Contrary to earlier studies, the study finds a negative and significant association between corruption and government spending on both education and the military. As the level of corruption increases, the total money spent on education and military decreases. Thus, governments should develop effective anti-corruption strategies so that they can increase the resources available to invest on economic and social development. |