Estimations of the impact of corruption on trade with the control of corruption index
| Variables | (1) Pooled OLS | (2) Fixed effects | (3) OLS CYFE and CPFE | (4) PPML CYFE and CPFE |
|---|---|---|---|---|
| lnYi | 1.129 (0.007)*** | 0.455 (0.013)*** | – | – |
| lnYj | 0.846 (0.007)*** | 0.677 (0.013)*** | – | – |
| lndist | −0.964 (0.023)*** | – | – | – |
| contiguity | 1.176 (0.093)*** | – | – | – |
| comlang | 0.831 (0.044)*** | – | – | – |
| colony | 0.609 (0.096)*** | – | – | – |
| comctry | 2.564 (0.112)*** | – | – | – |
| island | 0.196 (0.121) | – | – | – |
| landlocked | −0.522 (0.031)*** | – | – | – |
| religion | −0.109 (0.056)* | – | – | – |
| RTA | 0.614 (0.042)*** | 0.202 (0.016)*** | 0.183 (0.018)*** | 0.004 (0.031) |
| CU | 0.182* (0.106) | 0.019 (0.046) | 0.252 (0.048) | 0.017 (0.030) |
| CCIij | −0.276 (0.022)*** | −0.237 (0.018)*** | −0.491 (0.094)*** | −0.522 (0.207) ** |
| CCi-CCj | −0.028 (0.015)* | −0.003 (0.011) | −0.021 (0.017) | 0.036 (0.022) |
| Time dummies | Yes | Yes | No | No |
| CPFE | No | Yes | Yes | Yes |
| CYFE | No | No | Yes | Yes |
| R2 | 0.70 | 0.24 | 0.33 | 0.99 |
| Observations | 169,225 | 169,225 | 178,768 | 221,068 |
| Variables | (1) Pooled OLS | (2) Fixed effects | (3) OLS CYFE and CPFE | (4) PPML CYFE and CPFE |
|---|---|---|---|---|
| lnYi | 1.129 (0.007) | 0.455 (0.013) | – | – |
| lnYj | 0.846 (0.007) | 0.677 (0.013) | – | – |
| lndist | −0.964 (0.023) | – | – | – |
| contiguity | 1.176 (0.093) | – | – | – |
| comlang | 0.831 (0.044) | – | – | – |
| colony | 0.609 (0.096) | – | – | – |
| comctry | 2.564 (0.112) | – | – | – |
| island | 0.196 (0.121) | – | – | – |
| landlocked | −0.522 (0.031) | – | – | – |
| religion | −0.109 (0.056) | – | – | – |
| RTA | 0.614 (0.042) | 0.202 (0.016) | 0.183 (0.018) | 0.004 (0.031) |
| CU | 0.182 | 0.019 (0.046) | 0.252 (0.048) | 0.017 (0.030) |
| CCIij | −0.276 (0.022) | −0.237 (0.018) | −0.491 (0.094) | −0.522 (0.207) ** |
| CCi-CCj | −0.028 (0.015) | −0.003 (0.011) | −0.021 (0.017) | 0.036 (0.022) |
| Time dummies | Yes | Yes | No | No |
| CPFE | No | Yes | Yes | Yes |
| CYFE | No | No | Yes | Yes |
| 0.70 | 0.24 | 0.33 | 0.99 | |
| Observations | 169,225 | 169,225 | 178,768 | 221,068 |
Notes:
Sample period: 1996, 1998, 2000 and 2002 to 2012. Dependent variable: log of bilateral exports for Column (1) to (3) and bilateral exports in levels for Column (4). Robust standard errors (clustered by country-pairs) are in parentheses.
significant at 10%;
significant at 5%,
significant at 1%. OLS: Ordinary Least Squares. CYFE: Country-Year Fixed Effects. CPFE: Country-Pair Fixed Effects. PPML: Poisson pseudo-maximum likelihood. CCI: Control of Corruption Index. The Hausman test result for random effects vs fixed effects is 2974.71 (0.00)
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