...Assess the effects that corruption may have on economic development. How do you reconcile the anecdotal evidence with theoretical ideas? Introduction The World Bank defines corruption as: “abuse of public office for private gains”1. Corruption is seen to be an integral part of human society and demonstrates itself through a variety of ways – bribing politicians, using kickbacks or tipping a waiter in a restaurant to get a better table are all examples of corruption. Corruption is generally seen as an important factor that hinders the economic development of an economy. Overwhelming amount of literature, through presenting empirical and anecdotal evidence, argues that corruption reduces the efficiency, economic growth, domestic and foreign direct investment (FDI), disadvantages the poor, reshapes the government spending to an unsustainable way and is generally harmful for the economy. A small proportion of literature on corruption, however, presents rigorous arguments in favor of corruption- presenting evidence that corruption may actually “speed up the wheels of commerce” Wei (1998) and hence stimulate economic growth. My essay is based on the assumption (which most of the authors on corruption agree on) that generally – corruption is harmful for the economy, however one should distinguish the effects of corruption on a developed and developing economy. The main argument of my essay is that there is a major distinction between effects of corruption on developed and developing...
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...The Hong Kong Polytechnic University MGT682 Independent Studies Corruption in China: Effects on Economic Development and Remedial Policies Thomas Wu 02715615G August 6, 2003 The Hong Kong Polytechnic University MGT 682 Independent Studies Corruption and Bribery in China Thomas Wu 02715615G August 6, 2003 Table of Content RESEARCH PROPOSAL TOPIC.........................................................................................................3 INTRODUCTION....................................................................................................................................3 OBJECTIVES AND HYPOT HESIS.......................................................................................................4 NATURE OF RESEARCH.....................................................................................................................5 RIVAL THEORIES.................................................................................................................................5 “GREASE-THE-WHEELS” THEORY .........................................................................................................5 MULTIPLE EQUILIBRIUMS ......................................................................................................................7 LOGIC MODEL......................................................................................................................................8 SIGNIFICANCE OF STUDY..............................
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...Corruption is a form of dishonest or unethical conduct by a person entrusted with a position of authority, often to acquire personal benefit. Corruption may include many activities including bribery and embezzlement, though it may also involve practices that are legal in many countries. https://www.google.com.ph/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=corruption Political corruption is the use of powers by government officials for illegitimate private gain. An illegal act by an officeholder constitutes political corruption only if the act is directly related to their official duties, is done under color of law or involves trading in influence. Forms of corruption vary, but include bribery, extortion, cronyism, nepotism, gombeenism, parochialism patronage, influence peddling, graft, and embezzlement. Corruption may facilitate criminal enterprise such as drug trafficking, money laundering, andhuman trafficking, though is not restricted to these activities. Misuse of government power for other purposes, such as repression of political opponents and general police brutality, is also considered political corruption. The activities that constitute illegal corruption differ depending on the country or jurisdiction. For instance, some political funding practices that are legal in one place may be illegal in another. In some cases, government officials have broad or ill-defined powers, which make it difficult to distinguish between legal and illegal actions...
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...CONCEPT OF NATIONAL DEVELOPMENT 1. MEANING AND NATURE OF DEVELOPMENT Development is a multi-dimensional process. Development according to international encyclopedia of social science "is a rapid sustained rise in real output per head and attendant shift in technological, economical and demographic characteristic of a society together with the more concept of social development and political development". Walter Rodney opined that "Development in human society is a many sided process. At the individual level it implies increased skill and capability, greater freedom, creativity, self discipline, responsibility and material well being". Amaucheaz, in his submission stated that, development is a multi-dimensional process involving the totality of man in his political,, economical, psychological, social relations among others. Development as a concept is multi-dimensional phenomenon that embraces economics, political and socio-cultural aspect of a nation. When the political, social and economic conditions of a state are in good shape, that state qualifies to be termed developed or developing state. 3.2 NATIONAL DEVELOPMENT STRATEGIES, NEED AND ECONOMIC DEVELOPMENT. The national development strategy is a means, way, and plan in which the government formulates and implements its policies in order to accelerate the rate of development in the policy. Obasanjo administration made series of efforts to lay a solid foundation for the socio-economic growth of the country...
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...CHINA’S PROVINCIAL BUREAUCRATIC CORRUPTION ON FDI AND ECONOMIC GROWTH Ziwei Hao z_hao@mit.edu TA: Joaquin MIT Department of Economics, 14.05 Spring 2012 Word count: 5000 I. INTRODUCTION China’s economic achievement over the past three decades has been one of the most outstanding of our time. Since its “reform and opening-up policy” in 1978, foreign direct investment (FDI) has contributed a great deal to China’s economic growth by injecting capital into the economy, creating jobs, transferring technology and knowledge, enhancing trade, bringing in competition for local enterprises, improving the quality of local labor and intermediate goods suppliers, and connecting China’s gradually opening economy to the global market (Berthélemy and Démurger, 145). By the opening up of the country to FDI, China’s economic growth has averaged approximately 9% annually over the last 25 years (China Statistical Yearbook). With the introduction of FDI came a wave of corruption and bad governance, which may have hindered FDI’s effect on China’s economic growth. The reform in the market encouraged private institutions to compete for market share and resources. In order to rise to the top, these private intuitions required the help people in power who are not under heavy scrutiny. Local government officials were the perfect targets. With foreign capital in their hands, private intuitions sought out local government officials for help in exchange for bribery. These “favors”...
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...Corruption: Good or Evil Corruption in developing countries perpetuates to be one of the greatest factors of poverty, development and internecine conflicts. Although many developing nations are endowed with priced natural resources, yet they struggle and scramble for position in the lower rungs of the United Nations Development Index. Most developing countries perpetuate to grapple with the ever transmuting trends in global politics, economic and technological advancements having little or nothing to do due to the weakening effects of corruption on their very subsistence. From the USA to the Philippines, corruption perpetuates to have an adverse effect on the lives of the vast majority of the population. Understanding the concept of corruption presupposes that one should have a clear dichotomy of what it entails and what constitutes it in the simplest term. There is no single accepted definition for the term ‘corruption’ because what may seem corrupt in one society may not indispensably be perceived as such in another. Though there have been different endeavors to define it, there is no precise, clear definition that can be applied to all forms, types and degrees. According to Friedrich (1972), “Corruption is a kind of behavior which deviates from the norm actually prevalent or behaved to prevail in a given context, such as the political. It is deviant behavior associated with a particular motivation, namely that of private gain at public expense.” The Oxford English...
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...and corruption in the world that we are currently living based on the mixed economic worldview which is my personal economic worldview which threatens to undermine the stability of economic and political development on both a national and global scale, and which requires both immediate and wide-ranging policy interventions. The recent concern with corruption is attributable, not to any substantive increase in corrupt practices, but rather, to the re-framing of corruption in light of broader shifts and transformations within the global economy. The historical context of globalization covers centuries. This paper reviews the types, forms as well as the consequences of corruption. The paper also reviews the issues associated with globalization and the effect it has on the lives of various individuals. It questions the view that, under certain conditions, corruption may enhance efficiency and argues that though corruption may benefit powerful individuals it will indubitably lead to greater inefficiency and a waste of resources at a macro-economic level. Table of Contents ABSTRACT i INTRODUCTION iii BACKGROUND iv Forms of Corruption vi 1.1 Bribery vi 1.2 Theft and fraud vi 1.3 Embezzlement vi 1.4 Nepotism vi 1.5 Conflict of Interest vi 1.6 Favouritism vii Types of Corruption vii 2.1. Grand corruption vii 2.2 Political corruption vii 2.3 Corporate corruption vii 2.4 Administrative corruption vii 2.5 Petty corruption vii 2.6 Systemic corruption vii ...
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...in Africa and the Roll of Corruption The major cause and reason for poverty around the globe is corruption. Unfortunately corruption occurs at all levels of every society, from national to local governments, judiciary functions, civil society military, small and large businesses and other services and so on (www.globalissues.org). The poorest countries are mostly affected by corruption despite it being in almost all nations. Political development is undermined by corruption since all aspects of society are somewhat affected (www.globalissues.org). It is not fundamentally useful to make collective differences between corruptions in several parts of the globe. In the end it all comes down to the same thing the abuse or use of public office and resources for private gain. However, corruption can be split into grand corruption, petty corruption and looting (unpan1.un.org). Petty corruption is a situation where small gifts and small amounts of money change hands. The parties involved are relatively minor officials within an organization where the transaction took place. An example is paying a policeman a dollar to look the other way after doing a minor infraction (unpan1.un.org). Grand corruption is a situation whereby a businessman and a senior ranking government official, and the figures exchanging hand are significant. A good example is the kickback received after government tenders or contracts are awarded. Looting is the third type of corruption. It has recently been described...
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...Hewlett-Packard [Year] CORRUPTION AND LOCAL GOVERNMENT ADMINISTRATION IN NIGERIA: Introduction Nigeria is rich in natural and human resources, with a population of over 150 million people; the most populous country in Africa. At the time of her political Independence, on 1st October 1960, Nigeria excelled in production of agricultural produce such as groundnut, palm oil, cocoa, cotton, beans, timber and hides and skins. Then, during the oil boom period of the seventies Nigeria made headlines with her oil wealth, as a country richly endowed with oil and natural gas resources capable of financing a number of important projects to meet basic consumption and development needs (Salisu, 200:2). With per capital income of around $1,100 during the late 1970’s Nigeria was regarded as the fastest growing country in Sub-Sahara Africa (Salisu, Ibid). Yet it remains predominantly underdeveloped due to the scourge of corruption that has corroded it. Corruption denies the ordinary citizen the basic means of livelihood, it worsen unemployment and erodes our image as a nation and as individual (Danjuma Goje 2010:1). It has undermined Nigeria’s economic growth and development potential, with a per capital income of $340, Nigeria now ranks amongst the least developed countries in the World Bank League table (Salusi, op.cit). Nigeria’s higher education system once regarded as the best in Sub-Sahara Africa is in deep crisis. Health services are woefully inadequate, graduate unemployment...
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...Assess the significance of three factors which might limit economic development in the developing countries. Economic development can be defined generally as involving an improvement in economic welfare, measured using a variety of indices, such as the Human Development Index (HDI). A developing country is described as a nation with a lower standard of living, underdeveloped industrial base, and a low HDI relative to other countries. There are several factors which may have the effect of limiting economic development in such countries. Factors such as these include: primary product dependency, the savings gap and political instability. Primary product dependency occurs where production of primary products accounts for a large proportion of a country’s GDP. This can have a particularly limiting effect on economic development when a country’s primary product is what may be classified as a “soft commodity”, that is to say, agricultural goods mainly such as wheat, rice, palm oil etc. For example, Kenya has a high dependency on tea and horticulture. This may limit economic development for several reasons. Both supply and demand for primary products tend to be elastic thus and demand or supply-side shock would cause a relatively large price change, meaning that primary products are likely to experience extreme price fluctuations. These price fluctuations will cause fluctuations in producers’ income as demand is price inelastic. Therefore, a fall in price would cause a fall in total...
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...The Effects of Corruption and Economic Growth Cassandra Rogers Economics 523 Dr. David Dieterle Table of Contents Abstract……………………………………………………………………………………………3 Effects of Corruption on Economic Growth………………………………………………………4 Definition of Corruption..................................................................................................................4 Economic Rent…………………………………………………………………………….4 Bribery…………………………………………………………………………………….5 Trade Restrictions…………………………………………………………………………5 Is Corruption Good or Bad for an Economy………………………………………………………6 Low Levels of Corruption…………………………………………………………………6 Vietnam’s Economic Growth……………………………………………………..7 High Levels of Corruption………………………………………………………………...8 Conclusion………………………………………………………………………………………...8 References………………………………………………………………………………………..10 Abstract Corruption alone is not what fails an economy in growth. There are other factors to consider, such as, a weak and unstable government institution. Corruption can actually bypass these irregularities and possibly create growth in an economy. Studies show that there is no actual link between corruption and economic growth in “free” countries. In fact, low levels of corruption in free countries can be beneficial in economic growth. However, high levels of corruption can damage economic growth no matter the type of government institution or not. Effects of Corruption on Economic Growth If you ask citizens today, a great majority would probably...
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...Sir Dennis Duyag Introduction Corruption has recently become a major issue in foreign aid policies. However, behind the screens it has always been there, referred to as the “c-word”. The major concern for international aid policy through the last five decades is to improve the living conditions for the poor in the poorest countries of the world. This endeavour requires a close co-operation with the national governments in poor countries. Generally speaking, however, the governments in poor countries are also the most corrupt. This is one of the few clear empirical results of recent research on corruption. The level of GDP per capita holds most of the explanatory power of the various corruption indicators (Treisman, 2000; Paldam, 1999a). Consequently, if donors want to minimise the risk of foreign aid being contaminated by corruption, the poorest countries should be avoided. This would, however, make aid policy rather pointless. This is the basic dilemma corruption raises for aid policy. Unlike international business most development aid organisations and international finance institutions have the lion’s share of their activities located in highly corrupt countries (Alesina and Weder, 1999). The international community in general and some donor countries in particular are, however, increasingly willing to fight corruption. Within the “good governance” strategies of the World Bank and the International Monetary Fund initiatives to curb corruption are given priority. OECD and the...
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...DEVELOPMENT THEORY AND EXPERIENCE PROJECT CORRUPTION AND DEVELOPMENT PREPARED BY:- SHREYA BHARADWAJ(623) SWATI PAHWA(662) CONTENTS 1. What is corruption? 2. Need for a theory of corruption 3. Origin of corruption 4. Causes of corruption 5. Measuring corruption 6. A sketch of a theory linking corruption and development. 7. Correlation 8. Effect of corruption on development 9. Conclusion 10.Bibliography 11. Appendix 1. What is corruption? Now-a-days corruption can be seen everywhere. It is like cancer in public life, which has not become so rampant and perpetuated overnight, but in course of time. When we talk of corruption in public life, it covers corruption in politics, state governments, central governments, "business, industry and so on. Public dealing counters in most all government offices are the places where corruption most evident. If anybody does not pay for the work it is sure work won't be done. Corruption is a particularly serious issue in developing economies like India. “High levels of corruption limit investment and growth and lead to ineffective government. Developing countries and those making a transition from socialism are particularly at risk, but corruption is a worldwide phenomenon.” “If corruption does slow down economic development, East Asia must be an exception because while the region seems corrupt, it is able to attract lots of foreign investment and generate growth.” ...
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...Corruption and Development Making the link between corruption and development: An Appraisal of Selected SIDS Genève Phillip (Ms) University of the West Indies Author Note Ms. Genève Phillip, University of the West Indies, St. Augustine Campus, Trinidad and Tobago c/o Head, Department of Behavioural Sciences, Faculty of Social Sciences E-mail: geneve.phillip@sta.uwi.edu/genphillip18@yahoo.com Abstract: The development strategies of small island developing states have promoted extensive, ongoing and intense debate in academia. In assessing the political economy of SIDS it is useful to note not only the factors that give way to development but also the ones that impede it. While a variety of models have been used to describe the development strategies of SIDS, the extent to which some of these models have been able to adequately capture the major constraints to development in Caribbean SIDS is questionable. Having said this, the overarching argument in the discourse which follows is that corruption can be a major hindrance to the development efforts of Caribbean SIDS. In addition to this, an investigation will be launched into the impact that corruption has had on the development of Jamaica and Trinidad and Tobago. For all intents and purposes, the selected duo consists of one largely homogenous state and one heterogeneous state which will be juxtaposed to determine whether any similarity exists in the degrees of corruption in both countries. The...
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...in support of anti-corruption in emerging markets, such as Principle 10 of the United Nation’s Global Compact. We determined to explore this topic area after realizing a paradox: while the United Nations has recognized the phenomenon of corruption as “one of the world’s greatest challenges”, the sole UN principle that addresses this issue is under-developed and is the least among the four focus areas of the Compact (as compared to human rights, labour, and environment). Furthermore, there are even less initiatives undertaken by the UN that specifically address the prevention of corruption in emerging markets, both in business and government sectors. We begin by providing a literature review of past research in our topic area, followed by a theoretical analysis of the causes of corruption in emerging markets. As part of this theory, we have identified five variables that are our focus: level of poverty, cultural boundaries and differences, access to education, amount of extortion and bribery in government and business, and level of transparency and accountability. Using these variables, we arrive at new conclusions and then provide a discussion on their implications for international managers. Throughout the paper, we also explore the magnitude of the effects that have resulted from the addition of Principle 10 to the Global Compact. Introduction A wide variety of research on corruption has been done over the past century: from studies on its effect on democratic voting...
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