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Sean P. Lindstone sl0438a@american American University School of International Service

Corruption: An Obstacle to Wealth and Development?. Sean P. Lindstone sl0438a@american.edu American University School of International Service. Research Question:.

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Sean P. Lindstone sl0438a@american American University School of International Service

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  1. Corruption: An Obstacle to Wealth and Development? Sean P. Lindstone sl0438a@american.edu American University School of International Service

  2. Research Question: • What is the relationship between a country’s score on the Corruption Perceptions Index and that same country’s Gross Domestic Product (GDP) per capita? • Hypothesis: Corruption will have a strong negative relationship to wealth. This will show a stronger correlation to wealth than will official foreign aid.

  3. Background Literature: • Rostow’s 5 Stages of Development • Traditional society • Preconditions for take-off • Take-off (Driven by High Initial Investment) • Drive to maturity • Mass consumption • Solow: Technology and Labor Productivity • Sachs: Millenium Development Goals • Easterly: Incentives

  4. Data: • Dependent Variable: GDP per Capita (Wealth) • Independent Variables: • Corruption • Official Development Assistance • Gross External Debt • Sources: • IMF:World Economic Outlook • Transparency International:Corruption Perceptions Index • OECD: Official Development Assistance and Labor Productivity

  5. Regression Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. Correlations B Std. Error Beta Zero-order Partial Part 1 (Constant) -13068.923 1400.042 -9.335 .000 CPIScore 5490.257 291.541 .851 18.832 .000 .851 .851 .851 a. Dependent Variable: GDPCapitaUSD

  6. Conclusion: There is a significant and negative correlation between corruption and GDP per capita. Pearson’s r is .851. There is not a significant correlation between gross external debt and wealth. However, wealthier countries, on net, tend to have much larger debts. Official development assistance received has a moderate correlation to GDP per capita. Some poor countries receive tremendous assistance, while others receive relatively little.

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