Developing an Original Institutional Economics Framework for Understanding Corruption and Economic Development in Nigeria

Institutional economics offers powerful frameworks for understanding how governance failures like corruption constrain economic development, but an original framework specifically theorising the mechanisms of corruption's development damage in Nigeria's institutional context requires the integration of Nigerian political economy realities that generic frameworks elide. This study developed an original Institutional Economics Framework for Corruption and Economic Development in Nigeria, drawing on new institutional economics, political economy theory, and empirical research across six geopolitical zones. A theory-building methodology was employed, combining systematic review of 92 institutional economics and corruption-development publications from 2018 to 2024, qualitative research with 50 economic practitioners, public sector officials, and civil society actors, and quantitative analysis of governance and economic data across 36 states. Systematic review confirmed that existing frameworks inadequately theorised the patron-client redistribution function of corruption in Nigerian federalism, the interaction between federal fiscal structure and state-level corruption incentives, the role of oil-based corruption in creating structural adjustment-resistant rent networks, and the heterogeneous development consequences across different corruption types. The original Nigerian Institutional Corruption Framework proposes five analytical dimensions: extraction pathways (mechanisms of public resource diversion), reinvestment patterns (where extracted resources flow), institutional erosion (how corruption degrades governance capacity), growth suppression (investment and productivity channels), and resilient adaptation (how informal institutions compensate for formal institutional failures). Expert review confirmed the framework's original theoretical contribution. Recommendations include corruption pattern-specific policy responses rather than generic anti-corruption interventions.

Keywords: institutional economics, corruption, economic development, Nigeria, original framework