Corruption, Political Instability and Sustainable Development: The Interlinkages

The study empirically probed the interdependence among corruption, political instability and sustainable development for a panel of 28 developing economies and disaggregated sample of lower-middle and upper-middle income economies for the time period 2000-2014. The three stage least square (3SLS) estimation revealed that corruption negatively affects sustainable development and political instability. The political instability impedes sustainable development and corruption. The sustainable development reduces political instability and corruption. It explains that corruption enhances political stability and political stability increases corruption. The disaggregated estimates of developing economies are almost same as aggregate estimates of developing economies, however political instability has statistically insignificant effect on sustainable development in upper-middle-income economies. To go forward for sustainable development, the elimination of corruption is imperative.