‘Corruption is a real brake on human capital development’

Corruption discourages students in Africa from investing in higher education because they are more tempted by the easy gains of corrupt activities.

“Corruption has a direct and negative impact on the performance of education as it creates a lack of motivation in learning and in plans to pursue higher education because the return is very low.

“This result is explained by the fact that the return to education is very low in African countries and the less deserving are more favoured by acts of favouritism and nepotism at the expense of the deserving.”

This is according to a study, ‘Fighting Corruption in Developing Countries to Meet the Challenge of Human Capital Development: Evidence from Sub-Saharan African countries’, published recently in the Journal of the Knowledge Economy. It was authored by Porto Bazie and Noël Thiombiano from Thomas Sankara University and Eugenie Maiga from Norbert Zongo University in Burkina Faso.

The study examined the effect of corruption on the development of human capital via public investments and budget allocation in African countries over the period 1996-2018 using a literature review and by conducting theoretical and empirical modelling.

“Understanding how corruption affects the relationship between public expenditure and human capital is of particular interest for Sub-Saharan African countries, where the level of corruption appears to be very high,” the study pointed out.

Effect on public expenditure

The study indicated that corruption manages to reduce the output of education and the average duration of studies through its negative effect on the public expenditure on education.

For example, a 1% increase in corruption leads to a decrease of more than 1% in the public spending on education in Sub-Saharan African countries.

This is because corruption creates a distortion in the allocation of “public expenditure in favour of the military, transport, mining, energy and fuel sectors, where resources are easily concealed at the expense of those sectors where control over the use of funds is easier, such as education,” the study explained.

Corruption is a factor that is detrimental to the development of human capital because it reduces educational expenditure as a percentage of gross domestic product (GDP) and negatively influences investment in human capital and, thus, contributes to reduced economic growth, according to the study.

“Education can take a real hit in an environment where politicians are corrupt. Political corruption is detrimental to education, particularly through its effect on unemployment. In a corrupt environment, skills are not put to envy … but rather individual relationships [are],” the study pointed out.

The study also indicated that education is “very sensitive to corruption and it is difficult to obtain income from it, which is why fewer major projects are intended for it” which is why “people prefer to invest in political capital accumulation that secures bureaucratic power and engage in rent-seeking …”

The study ended by calling upon policymakers and international agencies to effectively fight corruption in public administrations in order to increase the returns of education.

Combating corruption

Dr Porto Bazie, the lead author of the study and a lecturer and researcher at the Center for Studies, Documentation and Research in Economic and Social Sciences at Thomas Sankara University, told University World News that “virtuous governance” has to be the first concern of every government in the developing world.

“Corruption is a real brake on human capital development as it distorts budget allocation against education and negatively affects the returns of education,” he said.

“This study tells us that the effectiveness of governments in developing countries, particularly those in Sub-Saharan Africa, in combating corruption is the answer to the challenge of human capital development,” he said.

“Promoting meritocracy in both public and private administration by increasing the efficiency of education is the way to protect students who have the will and ability to pursue higher education,” Bazie added.

“Academics can contribute to the fight against corruption by proposing and implementing institutional reforms aimed at sanctioning [punishing] corruption in all fields, and raising awareness of its harmful macroeconomic effects,” Bazie pointed out.