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Home > Issues > Vol. 11 No. 2 (2025) > Control corruption and innovation: Empirical evidence from upper middle income countries
RESEARCH ARTICLE Issue: Vol. 11 No. 2 (2025) | Published: 2025-12-21

Control corruption and innovation: Empirical evidence from upper middle income countries

ABSTRACT

This study analyzes the effect of corruption control on innovation in Upper Middle Income Countries (UMIC). Using panel data from 54 UMIC countries for the period 2014-2022 with 486 observations, this study applies Ordinary Least Squares (OLS) regression to identify the relationship between variables. The results show that corruption control has a negative and significant impact on innovation in the overall sample, suggesting a transition effect that initially slows innovation due to increased compliance costs and bureaucratic complexity. However, in countries with a high number of patent applications, corruption control increases attractiveness for foreign investors, creating a conducive environment for research collaboration and technology transfer. Whereas, in countries with high tax revenue, anti-corruption policies reduce the flexibility of fiscal incentives that previously supported innovation. Therefore, corruption control policies need to be balanced with strategies that support the innovation ecosystem to ensure sustainable innovation growth and enhance global competitiveness.

KEYWORDS

Innovation Corruption Control Upper Middle Income Countries Tax Revenue

AUTHORS & AUTHOR BIOGRAPHY

Nafis Dwi Kartiko

, Universitas Pelita Harapan

Faculty of Economics and Business, Universitas Indonesia, Depok, Indonesia

Directorate General of Taxes, Ministry of Finance of the Republic of Indonesia, Jakarta, Indonesia

Faculty of Law, Universitas Pelita Harapan University, Banten, Indonesia

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HOW TO CITE

Kartiko, N. D. (2025). Control corruption and innovation: Empirical evidence from upper middle income countries. Integritas: Jurnal Antikorupsi, 11(2), 203-218. https://doi.org/10.32697/integritas.v11i2.1480

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