THE NEXUS BETWEEN CORRUPTION, INCOME INEQUALITY AND POVERTY IN SOUTH AFRICA

Abstract

To achieve United Nations Sustainable Development Goal 3 and 10, which focus on ending poverty in all its forms everywhere and reducing inequality within and among countries, there is a need to examine the relationship between corruption, income inequality, and poverty within the South African context. This examination aims to recommend policies that will help achieve these goals. Therefore, this study investigates corruption-income inequality-poverty nexus for South Africa spanning from 1996 to 2020. This research contributes to the existing literature by utilizing advanced econometric techniques, including Autoregressive Distributed Lags and Fully Modified Ordinary Least Squares, to comprehensively investigate the complex interplay between corruption, income inequality, and poverty in South Africa. By employing these methods, the study offers a more nuanced understanding of the dynamic relationships over time, providing policymakers with valuable insights for designing targeted interventions to address these pressing socio-economic issues in South Africa. Autoregressive Distributed Lags and Fully Modified Ordinary Least Squares were employed to achieve the study's objectives. There is a long run relationship among the variables of interested in this study. However, in the short run corruption significantly impact income inequality. Addressing corruption in South Africa is crucial to mitigate income inequality and poverty in the long run. Immediate measures should focus on reducing corruption's short-term impact on income inequality. Long-term strategies should include effective anti-corruption measures to create a more equitable society, thereby reducing poverty and enhancing overall economic development.