A system includes multiple blades coupled to a rotor, a stationary shroud disposed about the multiple blades, and a clearance between the stationary shroud and each blade end of the multiple blades, wherein the clearance is configured to enable over tip leakage flow. The system also includes a diffuser section that includes an outer wall defining an expanding flow path downstream from the multiple blades. The outer wall includes a first wall portion having a first angle relative to a rotational axis of the multiple blades, and the clearance is configured to enable an increase in the first angle by maintaining the boundary layer along the outer wall with the over tip leakage flow.