Abstract
Today, more and more authors are involved in researching the economic phenomenon of corruption and its impact on many macroeconomic indicators. Nevertheless, transitional surroundings have offered a unique opportunity in history to explore the relationship between corruption and economic growth in entirely different environment from the one in developed western economies. Researching of, at first sight, two unrelated social phenomena gave additional light on the causes of economic growth in Croatia. The researching paper also gives Croatian position among ten transition EU member countries. The corruption perception index was used as the best measuring method of corruption in Croatia and other countries while economic growth was measured by GDP per capita instead of growth rates. We explained reasons why we did so. The time period covered by the research was from 1999 to 2009 for Croatia and from 1995 to 2009 for ten transition EU member countries. Total of 137 cases were evaluated. The researching paper demonstrates the negative impact of corruption on economic growth where the strength of its influence is relatively obvious. It is also evident that the impact of corruption on economic growth is substantially a direct one and that it takes place without a significant time delay. Results for the period of research related to Croatia, more closely fit the observed data of other transition countries. Corruption could be an additional explanation (certainly not the only one) for low or high level of GDP per capita in Croatia. Misunderstanding of all the factors that encourage the economic growth may lead to macroeconomic structural misbalances in Croatian economy.
Highlights
The transition from centrally-planned to a market economy represents a unique period in history which offered a chance for numerous studies of economic phenomena in completely different conditions in relation to the conditions that exist in developed Western countries and elsewhere
Corruption could include various forms like bribery, extortion, nepotism, embezzlement, fraud, insider trading and conflict of interest etc. This thoughtful of corruption may not be the same as the explanation of corruption evidencing in the some articles of Criminal Law in Croatia and other transition countries. This idea of corruption notes the heart of problem and a valid investigation using the advantage of adequate model for measuring corruption and its impact on economic growth could be carried out
The major question is: Does corruption impact on other social phenomena? In the centre of our interest we just put a research of prospective impact of corruption on economic growth as an important macroeconomic indicator of any economy
Summary
The transition from centrally-planned to a market economy represents a unique period in history which offered a chance for numerous studies of economic phenomena ( economic) in completely different conditions in relation to the conditions that exist in developed Western countries and elsewhere. It became obvious that the transition process is slower than initially expected, it has its costs, it is unfair to some segments of society, it often deepens the existing economic and social crisis, etc. Such conditions were different in many respects in relation to social and economic conditions that existed in developed countries, and elsewhere. They have created a unique opportunity to explore the relationship of corruption and economic growth in an entirely new, specific macroeconomic environment. We include in our research the transition countries that have become EU members because they passed like Croatia a very similar path during the period of the reforms
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