Does Corruption Impede the Accumulation of Human Capital in Developing Countries?

ABSTRACT We investigate the heterogeneous effect of various types of corruption on human capital accumulation in a sample of 88 developing countries from 2000 to 2018. Quantiles via moments regression is used for our empirical investigation. We find that corruption exerts an adverse effect on human capital accumulation. Moreover, the harmful effect of corruption on human capital accumulation is higher in countries with low stock of human capital and lower in countries with high stock of human capital. In addition, both public sector corruption and regime corruption are detrimental to human capital accumulation, although public sector corruption is the most detrimental. Furthermore, corruption disproportionately affects female human capital compared to male human capital. These results imply that anti‐corruption strategies should be taken into account in the formulation and implementation of policies to improve human capital in developing countries.