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THE JOURNAL OF SOCIAL POLICY STUDIES_
ЖУРНАЛ
ИССЛЕДОВАНИЙ СОЦИАЛЬНОЙ
ПОЛИТИКИ •••
ФАКТОРЫ НЕРАВЕНСТВА И СОЦИАЛЬНАЯ ПОЛИТИКА
Olawale James Gbadeyan, Olasupo Augustine Ijabadeniyi,
Tolulope Funmilola Ojo, Betty Oluwayemisi Ali-Momoh, Adesina Stephen Ojo
SOCIO-POLITICAL ENVIRONMENT AND CORRUPTION IN NIGERIA: AN EMPIRICAL ANALYSIS
No country is an exception when it comes to the issue of corruption, but the severity and structure of this phenomenon differ from one place to another. This research investigated context-specific relationships between the sociopolitical environment and corruption in Nigeria. The independent variable, i.e., socio-political environment is proxied by the following government effectiveness indices, such as the rule of law, human development, political stability, and political rights. The dependent variable, i. e., corruption is proxied by the corruption perception index. The study covers the period from 1999 to 2019 using Auto-regressive Distributed Lags (ARDL) for the analysis of the data and some diagnostic tests, such as serial correlation, heteroscedasticity test,
Olawale James Gbadeyan - Ph.D., Department of Peace and Conflict Studies, Federal University Oye-Ekiti-Ekiti State, Nigeria. ORCID https://orcid.org/0000-0003-3566-1450. Email: olawale.gbadeyan@fuoye.edu.ng
Olasupo Augustine Ijabadeniyi - Ph.D, Department of Sociology, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria. Email: Ijabadeniyioa@abuad.edu.ng
Tolulope Funmilola Ojo - M. Sc., Department of Public Health, College of Medicine and Health Sciences, Afe Babalola University, Ado-Ekiti, Nigeria, ORCID 0000 0003 2368 9237. Email: ojotolulopef@abuad.edu.ng
Betty Oluwayemisi Ali-Momoh - Ph.D., Department of Accounting, Federal University Oye-Ekiti-Ekiti State, Nigeria. Email: oluwayemisi.alimomoh@fuoye.edu.ng
Adesina Stephen Ojo - Institute of Part-time Studies, Federal University Oye-Ekiti, Ekiti State, Nigeria. Email: shina4all_stevo@yahoo.com
© Журнал исследований социальной политики. Том 20. № 3
and normality test, which were carried out to test the findings. The result revealed that only political stability significantly influences corruption in Nigeria, underscoring the importance of uninterrupted democracy since 1999 in corruption perception of the country. Contrarily, the government effectiveness, the rule of law, human development, and the political right indices failed to have a significant impact on corruption perception and control in Nigeria. This implies that, with the current socio-political environment in Nigeria, corruption cases in the country have been on the rise. Hence, Nigeria's socio-political environment is too weak to have any significant effect on corruption control. The study recommends, among other things, that the rule of law should be followed effectively so that corruption can be curtailed in Nigeria.
Keywords: Socio-Political environment, Corruption perception, Empirical assessment, corruption, Nigeria
DOI: 10.17323/727-0634-2022-20-3-445-456
All over the world, there are continuous debates on the relationship between a country's political setup and corruption (Agbiboa 2012). No country is an exception when it comes to corruption, but its severity and structure differ from country to country. Both factors, in most cases, depend on effective institutions whose stable functioning is guaranteed by political leaders and is aligned with societal needs (Elbasani, Sabic 2018). Therefore, governance should be done in a way that does not infringe on the rights and welfare of the citizens (Hossain, Kryzanowski 2020). To achieve this, two governance functions are of particular importance: management of economic conditions and redistribution of income and resources. Given this, corruption can be understood as a political environment which leads to practices of political leaders that do not contribute to effective administration of the county's economic conditions and fair redistribution of income and resources (Agbiboa 2012).
Nigeria as a country embraced democracy in 2000. Back then, the military dictatorship, which had been the hallmark of the political environment in the country for decades, changed to democracy and marked the emergence of another political environment that was believed to be liberal and could enable the government to perform its functions effectively. However, despite these hopes, Nigeria has been witnessing rising corruption, which reflects the failure of the country's political institutions to manage the economic conditions and redistribute income and resources efficiently. Currently, Nigeria is ranked 154 on the corruption index among 180 sampled countries by Transparency International (Oyedeji 2022). The global corruption index also ranked Sub-Saharan Africa (SSA) as the second most corrupt region in the world. Nigeria is among the top countries where corruption is endemic, including the SSA countries, which has taken its toll on the economy (Park, Lee 2006). The recent IMF report reduced the projected economic growth for the SSA region, citing the slow pace of economic growth in Nigeria and South Africa as the major reason (IMF 2020).
Although several efforts have been made to tackle the country's corruption problem over the years, they failed to achieve their objectives. One of the reasons is that the political environment in Nigeria produces political leaders with different ideas to manage the country's economy, manifested in their policies and party manifestos (Fagbadebo 2007). Since 2000, different administrations have been coming up with various ideas to tackle corruption. These ideas have culminated in the establishment of various anti-graft agencies, such as the Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices Commission (ICPC), and Special Anti-Fraud Unit of the Nigeria Police (SAFU) among others, yet the problem of corruption persists.
According to the country - based analysis, it has been ascertained that more than 65 % of corruption cases in Nigeria are traced to the public sector managed mainly by the political leaders (Transition Monitoring Group 2018). Could it have been that the socio-political environment that led to the emergence of these political leaders encourages corruption? This question has continued to generate debates over the years, but there is no consensus. For instance, some researchers (Egharevba, Chiazor 2013) concluded that the political environment by itself might not encourage corruption, but the financial policies of the public office holders who manage the resources allocation and appropriation of funds in various organizations do. On the contrary, others (Arowolo, Olaniyan 2018) suggested that Nigeria's social and political environment is structurally defective and thus encourages corruption. The most common aspect of these studies is their scope and methodology. In terms of methodology, they are primarily desk research that relied on literature review to draw conclusions (except, Jiménez, Alon 2018). The present study, apart from focusing on Nigeria as a case, employs empirical methods of data analysis to investigate the relationship between Nigeria's socio-political environment and corruption.
Public choice theory of corruption
The public choice theory appears as one of the most popular to explain corruption. It claims that public officials are corrupt for a simple reason (Rose-Ackerman 2008): they perceive that the potential benefits of corruption exceed the potential costs. If the benefits of corruption minus the probability of being caught times its penalties are greater than the benefits of not being caught, then an individual will rationally choose to be corrupt (Klitgaard 1991). The advantage of public choice theory is that it has a relatively close focus (Schinkel 2004). Instead of looking for general determining factors, it concentrates on a specific situation of an agent (a corrupt official) who calculates pros and cons at the expense the larger social context. As a result, the public choice theory has often been criticized for its narrow focus. This theory also cannot account for triggering causes within the situation as it activates at the moment an official calculates whether to become corrupt or not. Therefore, the question arises why are some
officials corrupt while most are not? If someone calculates that corruption is a good deal, then there will be more tendency to be corrupt against the perception that corruption is bad. We argue that in addition to the cost and benefit calculation, corruption is also determined by the political environment of the country.
The bad apple theory, like public choice theory, primarily looks at the level of the individual corrupt agent for the causes of corruption. These studies seek the cause of corruption in the existence of people with faulty (moral) character, or the so-called 'bad apples.' There is a causal chain from bad character to corrupt acts; the root cause of corruption is found in flawed human character and predisposition toward criminal activity. Causes are rooted in human weaknesses, such as greed. When the focus is on the faulty character of an official, morality is assumed to determine behavior as people are assumed to act on the basis of moral values. 'Wrong' values are, therefore, the cause of corruption. Of course, one can question whether people act on the basis of moral values (de Graaf 2007). However, the focus on individual corrupt officials and their motives can also be of a different nature. Therefore, we focus instead on the environment that leads to corruption.
In Nigeria, the state has been a victim of high-level corruption, bad governance, political instability, and a cyclical legitimacy crisis (Fagbadebo 2007). Consequently, national development is flawed, and the political environment is uncertain. The country's authoritarian leadership faces a legitimacy crisis and political intrigues in an ethnically differentiated polity, where competition for resources drove much of the pervasive corruption. While the political leaders constantly manipulated the people and the political processes to advance their own agendas, the society remained pauperized and the people wallowed in poverty. In turn, this invariably weakened the political legitimacy, as the citizens lacked faith in their leaders and by extension, the political system. Participation in government was low because citizens perceived it as irrelevant to their lives and there were no social lifts for the populace. In the absence of support from civil society, the effective power of government was eroded. Patron-client relationships took a prime role over the formal aspects of politics, such as the rule of law, well-functioning political parties, and a credible electoral system.
A different approach examines the link between corruption and underdevelopment to see whether corruption is responsible for the shortcomings and poor performance of the Nigerian political economy (Agbiboa 2012). This research uncovered the underlying causes of corruption and its impact on national development. The study concluded that corruption is indeed the major reason for underdevelopment in Nigeria and the political class is responsible for it. . Taken in historical perspective, political leadership, socio-economic development, and corruption have been interwoven in Nigeria since 1960 (Ogbeidi 2012). Hence, for Nigeria to experience sustainable social-economic development, responsible and credible leaders must emerge to implement good and selfless governance in the country. Another study echoed this conclusion by suggesting that corruption will be overcome when Nigeria creates an environment where
the citizenry can define the kind and type of political change they really desire rather than the one that is imposed on them (Egharevba, Chiazor 2013).
A desk research (Arowolo, Olaniyan 2018) on the efforts of the federal government of Nigeria to combat corruption in the country concluded that these efforts face an inevitable challenge in the form of the very same corruption. In the meantime, various agencies and policies have been set up, such as the Presidential Advisory Committee on Anti Corruption (PACAC), National Prosecution Coordination Committee (NPCC), Administration of Criminal Justice Act (ACJA), Treasury Single Account (TSA), Freedom of Information Bill (FolB), and Whistle-blower policy.
It is obvious that most of these studies are based on theoretical literature and conceptual reviews or pure desk research methods. In other words, few of them made use of empirical methodologies to achieve their objectives. This study is empirically-based, uses secondary data, and applies quantitative methods of analysis to achieve its objectives. Relying on the public choice theory of corruption where the causative factors of corruption are identified as the cost and benefit accruing to the individual that has the intention to perpetrate corruption, this research argues that these costs and benefits are the products of the socio-political environment prevailing in that country at a certain period of time. Based on this premise, corruption can be described as:
Coruptnt = f(SPolenvt) (1)
Where, is corruption perception index in Nigeria at period t and is the socio-political environment at period t. According to previous studies (Elbasani, Sabic 2018), the socio-political environment is defined using the following variables: political right, human development, corruption control, rule of law, government effectiveness, and political instability indices. The model is expressed more explicitly as follows:
Corpert=fq+Pi rule + f2polstab + f3govef+ [4 corper + [5poright+fghdi + ft (2)
Here, the index for the Rule of Law index (rule,-2.5 weak; 2.5 strong) captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular, the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence. The index of Political Stability and Absence of Violence/Terrorism (postab,-2.5 weak; 2.5 strong) measures perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including politically motivated violence and terrorism. The index is an average of several other indices from the Economist Intelligence Unit, the World Economic Forum, and the Political Risk Services, among others. The index of Government Effectiveness (govef,-2.5 weak; 2.5 strong) captures perceptions of the quality of public services, the quality of the civil service and the degree
of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government's commitment to such policies. The Corruption Perceptions Index (corper, 100 = no corruption) is an indicator of perceptions of public sector corruption, i.e., administrative and political corruption. The indicator values are determined by using information from surveys and assessments of corruption collected by a variety of reputable institutions. The Political Rights ratings (poright) from the Freedom House (7 weak - 1 strong) evaluate three categories: electoral process, political pluralism and participation, and the functioning of government. The Human development Index (From 0 to 1; 0 weak and 1 strong) measures the average achievement of key dimensions of human development, which encompasses long and healthy life, good education facilities, decent social life, and standard of living. Data on all the variables are sourced via the global economics data provided by the World Bank, 2019 edition.
Results
The impact of the socio-political environment on corruption in Nigeria is measured using cointegration analysis and estimation of the regression model. The idea of cointegration enables the study to investigate both the short and long-run impacts. The Auto-Regressive Distributed Lag (ARDL) approach is adopted for the study. The following steps are to be followed in ARDL estimation. As a pre-condition for cointegration analysis, this study conducts unit root testing for the time series data. A unit root indicates that the time series under investigation are non-stationary, while the absence of a unit root means that the time series data are stationary. To determine the order of series, this study uses the unit root test known as the Augmented Dickey-Fuller (ADF). The ARDL bound test involves computation of the F statistics and the critical values for the distribution. The critical values are computed for both lower and upper bounds. However, these critical values also appear for 1 %, 5 %, and 10 % statistical levels of significance. Conventionally, the 5 % statistical significance shall serve as the guide for decision. The computed F statistics value is compared to the critical values. The null hypothesis of no cointegration is accepted if the F statistics value is less than the critical values at both upper and lower bound for 5 % statistical level of significance, and otherwise it is rejected. The ARDL estimation divides the estimated equation into two, namely the long and short run coefficients. The first set of estimated parameters presents the short run relationships among the variables, while the second estimated coefficients are the short run relationships among the variables.
The discussion of the relationship between corruption and Nigeria's political environment begins with the assessment of the time series properties of the variables included in the regression model. The Augmented Dickey Fuller test is adopted for this purpose and the result is presented in Table 1. The results of the unit root test show that all the variables are integration of order one and
zero, that is I(1) and I(0). This shows that four of the variables are stationary after the first difference, while two are stationary at levels. This is a pre-condition for the application of ARDL. In addition, the dependent variable is required to be stationary at first difference. The unit root result is a confirmation that ARDL can be used to analyze the data.
Table 1
Unit root test
Variables ADF Statistics Order of Integration
CORPER -6.154251** I(1)
GOVEF -3.643663*** I(0)
POLSTAB -3.316639** I(0)
PORIGHT -4.197402*** I(1)
RULE -4.639972** I(1)
HDI -5.154961** I(0)
C*1 Statistical significance at 10 % (**) Statistical significance at 5 % (***) Statistical significance at 1 % Source: Authors' computation, 2020
Table 2
ARDL bound test for cointegration
Test Statistic Value K
F-statistic 5.181957 5
Critical Value Bounds
Significance I0 Bound I1 Bound
10 % 2.26 3.35
5 % 2.62 3.79
2.5 % 2.96 4.18
1 % 3.41 4.68
Source: Authors' computation, 2022
The next step is the cointegration test (Table 2). The idea behind cointegration is that if a variable is not stationary, a linear combination of the variable can be stationary. Table 2 shows the results of the cointegration test to ascertain if there exists a long or short run relationship between corruption and the political environment in Nigeria. The null hypothesis is that there is no long run relationship among the variables. However, considering the results as presented in Table 2, the F statistics value is 5.181957, which is greater than the critical values at 5 % for both lower and upper bound tests. The implication of the result is that the null hypothesis is accepted and hence we conclude that there is a long
run relationship between corruption and socio-political environment. However, the ARDL regression is needed.
Table 3
ARDL estimated regression
ARDL Cointegrating And Long Run Form
Cointegrating Form
Variable Coefficient Std. Error t-Statistic Prob.
D(RULE) 3.536833 3.909903 0.904583 0.3870
D(POLSTAB) -2.117373 1.675055 -1.264062 0.2349
D(POLSTAB(-1)) 5.233962 1.334186 3.922963 0.0029
D(GOVEF) -0.325894 4.651065 -0.070069 0.9455
D(PORIGHT) 1.178159 0.870131 1.354003 0.2055
D(HDI) 5.113873 3.608755 1.417074 0.1869
CointEq(-l) -0.725579 0.198429 -3.656621 0.0044
Cointeq = CORPER - (4.8745*RULE -10.5483*P0LSTAB -0.4491*G0VEF + 1.6237*PORIGHT + 7.0480*HDI + 7.1951)
Long Run Coefficients
Variable Coefficient Std. Error t-Statistic Prob.
RULE 4.874494 5.086447 0.958330 0.3605
POLSTAB -10.548288 2.190539 -4.815385 0.0007
GOVEF -0.449150 6.349015 -0.070743 0.9450
PORIGHT 1.623750 1.189460 1.365115 0.2021
HDI 7.047985 4.533588 1.554615 0.1511
C 7.195141 10.249246 0.702017 0.4987
Source: Authors' computation, 2022
After the establishment of cointegration, it is time to run the short and long run forms of the relationship between corruption and the socio-political environment in Nigeria. The result (Table 3) shows the short run and the long run impacts of the Nigerian socio-political environment on her corruption perception index. The division in long run and short run impacts enables us to further discuss the sustainability of various socio-political environment indicators regarding their effects on corruption perception of the country.
Out of all the five variables used to proxy socio-political environment in Nigeria, only political stability has a significant impact on the corruption perception index of the country. The coefficients of political stability are -5.233962 and -10.548288 in both short run and long run periods, respectively. The implication
of this is that political stability in Nigeria has a negative and significant relationship with the corruption perception index in Nigeria. It implies that the relationship between the two is inverse. Empirically, the result suggests that a unit increase in the level of political stability in Nigeria will reduce the corruption perception index by about 5 and 10 units in both short run and long run, respectively. The result underscores the importance of political stability in the control of corruption in Nigeria. This result is similar to the previous research (Perry 2018) that concluded that the uninterrupted democracy in Nigeria, which has led to a peaceful transition of power from one administration to the other for almost a decade, is very important in the corruption control effort in Nigeria.
The remaining four variables used as proxy for socio-political environment in the study fail to have significant impact on corruption perception index of the country. These variables are rule of law, human development index, political rights, and government effectiveness. For instance, the rule of law index describes perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence. The fact that the result from the analysis has shown that this index is not exerting significant influence on corruption perception index shows that the rule of law in Nigeria has not been implemented effectively. Some authors in the past also questioned the effectiveness of rule of law in Nigeria, especially when it comes to corruption control. These studies concluded that the rule of law in Nigeria is just a 'paper tiger' and that it is not effective in addressing corruption. The activities of the law enforcement agencies were cited by the studies as a cog in the wheel of rule of law (Ogbeidi 2012; Babatunde et al. 2021). The reckless behaviors of law enforcement agencies in Nigeria disregard the rule of law and hence its impact on corruption cannot be significant.
The human development index is a variable that measures the social-economic lives of the people, and it is part of the proxies of the socio-political environment in Nigeria. According to the analysis, the coefficient is not statistically significant either. This shows that the human development index, which explains mainly the social life of the people as it involves health, education, and standard of living among others, has not influenced corruption perception significantly. The political right index is another variable that failed to have a significant impact on the corruption perception index of the country in both the long and short run periods. The political right index evaluates three categories - electoral process, political pluralism and participation, and the functioning of government. The result indicates that the political right index in Nigeria is very weak and cannot significantly affect corruption. Previous studies also emphasized that a country where the electoral process is fraught does not epitomize good political rights (Agbiboa 2012; Babatunde et al. 2021). The fifth failed variable used to describe the political environment in Nigeria is the government effectiveness index. Government effectiveness captures perceptions
of the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government's commitment to such policies. This means that various government policies, especially the ones that have to do with the anti-corruption crusade, failed to significantly impact the corruption level in Nigeria (Agbiboa 2012).
Furthermore, the error correction term in Table 3 is -0.725579, which is statistically significant. The implication is that the adjustment to equilibrium is in the right direction and the feedback is about 72 %, as robustness tests to our estimations, heteroscedasticity, normality, and serial correlation tests are conducted. The results of the tests show that our model is not having the problem of heteroscedasticity, the residuals of the estimated ARDL model are normally distributed, and the serial correlation hypothesis should be rejected. Consequently, the estimates from our model are valid and can be used for forecasting.
Conclusions
Considering the findings from this study, some conclusions can be made regarding the relationship between Nigeria's political environment and the corruption perception of the country. Firstly, the results from the analysis demonstrate that political stability is vital to eliminate corruption in Nigeria. It is concluded from the study that the smooth transition from military rule to democracy has assisted in reducing the level of corruption in Nigeria, even though corruption remains. Secondly, the study has shown that rule of law, which is part of the variables used to proxy Nigeria's political environment, has not significantly influenced the corruption perception of the country. Thirdly, political rights, which include the right of the people to elect their political leaders, among others, failed to have a significant impact on corruption control or perception in Nigeria. This conclusion further underscores the importance of free and fair elections in corruption control. Again, the human development index has been found not to have influenced the corruption perception in Nigeria significantly due to poor conditions of national development. In addition, the study also concludes that the government effectiveness index as an indicator of Nigeria's political environment does not affect the corruption perception of the country significantly. The results from the study show that government effectiveness in Nigeria is weak and hence it has not been able to effectively combat corruption in the country.
Lastly, it is evident that out of the five indicators of socio-political environment, only political stability has a significant impact on corruption perception of the country. This conclusion speaks volumes about the weakness of the socio-political environment in Nigeria, which is unable to control corruption. The implication is that with the current socio-political environment in Nigeria, the corruption perception index of the country has continued to rise.
Hence, it means that instead of the socio-political environment in Nigeria defeating corruption, it has been enhancing it. Consequently, it is recommended that all five indicators must be improved so that corruption can be curtailed in the country, while political stability remains an important binding force.
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