The impact of corruption on climate risk – An international evidence

Prior studies suggest that climate disasters increase corruption due to the windfall of donations. However, is it possible that corruption increases the probability of occurrence and consequences of climatic disasters? This paper investigates the intricate relationship between corruption and climate risk using a comprehensive panel dataset spanning 171 countries from 2006 to 2019. Employing robust econometric methodologies, including fixed effects and a two-step generalised method of moments, we explore whether corruption exacerbates the probability and severity of climate-related disasters. Our findings reveal a significant positive association between corruption levels and climate risk, indicating that corruption amplifies both the frequency and consequences of climate disasters. Importantly, this relationship holds across diverse geographical locations and development statuses, with a particularly pronounced impact observed in developing countries where corruption compounds existing infrastructural vulnerabilities. These findings highlight the imperative for policymakers to address corruption alongside environmental and geographical factors in crafting effective strategies to mitigate climate-related disasters and enhance global resilience.