Economic growth, corruption, political stability and trade openness interaction in brics: A panel ardl approach

The investigation aims to scrutinize the impact of corruption, political stability and trade openness on economic growth in BRICS from the period 2002–2018. For this, we have employed the Augmented Solow Model and empirically, we have used the Panel Autoregressive Distributed Lag Model (ARDL) model. Stationarity is checked by using unit root test and cointegration test was employed to check the long-run relationship among the variables. The results of our model show that political stability and trade openness improve economic growth. However, the inverted U-shaped relationship between corruption and economic growth shows that control of corruption increases economic growth in the long run to a certain level after that it downbeat economic growth. Conversely, the results of the granger causality approach showed a unidirectional causality from CORR1 and lnGDP, CORR2 and lnGDP, CORR2 and CORR1, and CORR1 and TO and bi-directional causality from CORR2 and TO. Finally, based on our empirical scrutiny, some policy implications are suggested. This paper contributes new insight into the relationship between corruption and economic growth.