Financial Crime World

The Impact of Financial and Economic Crime on GDP and HDI

Regression Results

The following results summarize the impact of various financial and economic crime proxies on GDP per capita and Human Development Index (HDI) based on regression analysis.

Variables Included in the Models

  • Corruption
  • Shadow Economy
  • Cybercrime
  • Money Laundering

Key Findings

Negative Effects on GDP and HDI

  • Corruption: A 1% increase in Corruption reduces GDP by 4.6% and HDI by 0.03%.
  • Shadow Economy: A 10% increase in Shadow Economy reduces GDP by 11.91% and HDI by 7.01%.

Positive Effects on GDP and HDI

  • Cybercrime:
    • Model (4a) estimates that an increase in Cybercrime increases GDP by about 279.69% (multiplicative).
    • Model (4b) estimates that an increase in Cybercrime increases HDI by about 9.67%.
  • Money Laundering: An increase in Money Laundering increases economic prosperity, with each unit increase resulting in a 14.56% increase in GDP.

Interpretation

The results suggest that:

  • Corruption and Shadow Economy have negative effects on both GDP and HDI.
  • Cybercrime has a positive effect on both GDP and HDI.
  • Money Laundering has a positive effect on economic prosperity, but its impact is relatively small compared to the other variables.

Important Note

These findings are based on regression analysis and should be interpreted in the context of the data used.