Corruption and economic growth in the Western Balkans: A legal and economic perspective from the Balkan public barometer

This investigation considers the intricate relationship between corruption, governance, and economic growth in the Western Balkans. The study connects legal and economic aspects in order to evaluate their ramifications towards development. Through a review of other literature and regression analyses, the study tests two hypotheses: H1. Perceived corruption (PC) is negatively related to economic perceptions (EP) and H2. The strength of the trust in legal framework moderates the relationship of PC and EP. Results of analysis confirm H1, indicating a statistically significant negative coefficient for PC (-0.063, p < 0.01), and a positive effect of institutional trust on EP (0.315, p < 0.01). Thus, the results show that PC has a negative impact on EP, while governance helps lessen the effects of PC. H2 also finds support as there is a negative interaction effects (-0.013, p < 0.01) found suggesting that weaker legal frameworks have an enhancing effect on the economic toll of corruption, while stronger legal frameworks lessen the toll of corruption. Given previous studies that have considered corruption as a barrier to growth, the results of the study bolster the need for strong institutions and legal reforms, specifically as it pertains to European Union enlargement area. The study recommends that in order to address corruption in the Western Balkans, there needs to be an emphasis on both reducing corrupt acts and strengthening governance and legal framework, in turn supporting long-term and sustainable economic development.