Remittances and corruption in Nigeria

Abstract

PurposeIn this paper, we investigate the impact of remittances on control of corruption in Nigeria for a period of 1986–2016.Design/methodology/approachThe study uses ARDL modeling framework, dynamic OLS estimation, variance decomposition and impulse response analysis to examine the relationship between the two variables.FindingsThe study finds that remittances significantly improve the control of corruption in Nigeria. We further examine the robustness test of the results using dynamic OLS estimation, variance decomposition and impulse response analysis. Our results remain significant and consistent to the earlier one reported in ARDL framework which supports the extant literature.Practical implicationsOur study suggests that international remittances can be used, through the cross-border transfer of norms and practices, to significantly impact the socioeconomic progresses of a country by reducing corruption.Originality/valueThe existing studies on the relationship between corruption and remittances document conflicting results. In addition, study on corruption - remittances nexus that specifically focuses on any African country is largely absent despite the fact that most of the countries in the region are recognized as highly corrupt. This paper provides insights on how remittances can be used as part of tool kits to control corruption in African nation.