Spatio-Temporal Dependence of Corruption in Vietnam

Corruption levels are clustered in space and time simultaneously, and they differ not only between but also within countries. This study adds to the literature by shedding new light on the cause of corruption. Specifically, it investigates a further question that arises whether there is an effect on the corruption levels of neighboring sub-national regions within a country over time. Using the Dynamic Spatial Durbin models with provincial data during 2006–2017, this paper finds that the corruption levels of a specific province are influenced by both corruption level and its lags of neighboring provinces, and this effect decreases with more considerable geographic distance between provinces. Estimated results also show that the spatio-temporal dependence of corruption levels is explained by spatial externalities, including immigration, provincial governance and policy, but not economic development. These results provide theoretical applications for studying corruption and shed light on anti-corruption policy design in transitional countries where corruption is rampant.