Paper Title
Corruption and Economic Growth: How does Piety Matter?
Abstract
This study integrated the religious dimension into the economic analysis of corruption and growth. The idea along
which, religion matters in explaining the extent of corruption -in addition to the conventional factors (institutional and economic
ones)- was defend. Parting from the fact that Qur’an and Prophetic Narrations forbid corruption, the more pious is a
Muslim, the lower should be his incentives for corruption. Hence, a higher level of piety in a society should translate into
higher economic outcomes. The tractable analytical model developed in this study showed two possible channels for corruption
to damage the long-run rate of economic growth. It also showed that, there is a minimum level of piety required for an
economy to be productive. Below this threshold, the economy moves away towards an illegal rent-seeking situation. In addition,
better quality of institutions and a reduced income tax contribute in lowering the threshold of piety required for an
economy to move away from rent-seeking activity and towards productive activity.
Keywords- Piety, Islamic References, Corruption, Public investments, Economic growth JEL Classification: E62, O43, P47