Political Corruption, State Functionality, and Sustainable Development: Evidence From African Economies

ABSTRACT Political corruption remains a central governance concern in Africa, yet its empirical relationship with sustainable development is more nuanced than often assumed. This study examines how political corruption and state functionality relate to progress toward the Sustainable Development Goals (SDGs) in 39 African countries over the period 2006–2022. Sustainable development is measured using the Sustainable Development Goals Index (SDGI), and the analysis explicitly distinguishes political corruption (elite‐level integrity failures) from state functionality (operational governing capacity). Baseline two‐way fixed‐effects estimates indicate that political corruption is negatively associated with SDG performance. However, this relationship becomes weaker and statistically insignificant in several robustness specifications, including dynamic models that account for persistence in SDG outcomes. In contrast, state functionality exhibits a consistently positive and statistically significant association with sustainable development across baseline, lagged, and cross‐sectional dependence–robust estimators. Driscoll–Kraay, panel‐corrected standard errors, Common Correlated Effects (CCE), and Augmented Mean Group (AMG) estimators confirm the stability of the state functionality effect. Dynamic specifications reveal strong persistence in SDGI, suggesting that institutional influences operate gradually over time. Although interaction and marginal‐effects analyses produce a negative interaction term between corruption and state functionality, the coefficient is not statistically significant in the main models, indicating only suggestive evidence of moderation. Overall, the findings highlight the comparatively robust role of state functionality in shaping multidimensional development outcomes in Africa, while the direct and conditional effects of political corruption warrant cautious interpretation.