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There are at least two important things to consider when examining the developmental trajectory of states when it comes to corruption. The first is that there are different types of corruption. The second is that the international community—at least through its media—looks on some types of corruption less favourably than others. But, this is sometimes misplaced.

When it comes to countries like Nigeria, the media assumes that corruption is the only reason for the country’s failure to break past itslower middle income status. The assumption appears to be that if the billions stolen by corrupt leaders were recovered and invested properly in public services, Nigeria would prosper.
There are several problems with this notion. Economic development is not an event occurring at a single point in time. It is an ongoing and dynamic process. If corruption does in fact affect systemic economic performance, we need nuanced analysis to figure out how that happens.
The Cost of Corruption

If corruption affects a country’s economy, one possible avenue is through transaction costs. We understand from the work of the American economic historian Douglass North that legal and regulatory stability, or a lack of it, affects a country’s economic performance. It affects the ability of business to efficiently and effectively calculate the cost of transactions.

North argued that the development of rule of law institutions, for example, is what enabled economic development in the UK. Business innovators could work in an environment where the cost of business can be reliably calculated and legally maintained. But this has not meant that countries such as the UK are free of corruption. They are merely corrupt in a way that does not overtly hamper economic productivity.

READ FULL AT: http://nairametrics.com/the-type-of-corruption-that-really-hampers-nigerias-economy/