Corruption and Economic Transformation in Nigeria: An Agency Theoretic Perspective

The Nigerian nation is no stranger to economic reforms. Yet, in spite of more than half a century of reforms, the debilitating effects of an economy in distress are still very much with us. The manufacturing sector that is supposed to be the engine room of the nation’s economy has been characterized by low capacity utilization and declining contribution to national output. The resultant effect of all these is poor standard of living and ravaging poverty. Adopting the “Principal – Agent Model” as a theoretical basis, the paper argued that due to the privileged position of the agents (elected public officials) to public resources and information, they tend to abuse these privileges by acting contrary to the interest of their principal (the electorates). The paper therefore among others recommends that the principals should be more alive to their responsibility by seeking for information and regular monitoring of the activities of the agents in order to ensure Public Sector Accountability.