CORRUPTION

Corruption is defined as the use of public office for private gain, or in other words, use of official position, rank or status by an office bearer for his own personal benefit. Following from this definition, examples of corrupt behaviour would include: (a) bribery, (b) extortion, (c) fraud, (d) embezzlement, (e) nepotism, (f) cronyism, (g) appropriation of public assets and property for private use, and (h) influence peddling.

In this list of corrupt behaviour, activities such as fraud and embezzlement can be undertaken by an official alone and without involvement of a second party. While others such as bribery, extortion and influence peddling involve two parties – the giver and taker in a corrupt deal.

The two party type of corruption can arise under a variety of circumstances. Often mentioned are concerned with the following:
(i) Government contracts: bribes can influence who gets the contract, the terms of the contract, as well as terms of subcontracts when the project is implemented.

(ii) Government benefits: bribes can influence the allocation of monetary benefits such as credit subsidies and favoured prices and exchange rates where price controls and multiple exchange rates exist. Bribes can also be important in obtaining licenses and permits to engage in lucrative economic activities such as importing certain goods in high demand and in short supply. Moreover, bribes can be employed to acquire in-kind benefits such as access to privileged schools, subsidized medical care, subsidized housing and real estate, and attractive ownership stakes in enterprises that are being privatized.

(iii) Government revenue: bribes can be used to reduce the amount of taxes, fees, dues, custom duties, and electricity and other public utility charges collected from business firms and private individuals.

(iv) Time savings and regulatory avoidance: bribes can speed up the granting of permission, licenses and permits to carry out activities that are perfectly legal. This is the so-called “grease money” to turn the wheels of bureaucracy more smoothly, speedily and hopefully in the right direction. It is also not difficult to think of a really awful situation where rules and regulations, and the way they are applied, are so complex and burdensome that the only way left to get things done is to pay money to avoid them.

(V) Influencing outcomes of legal and regulatory processes: bribes can be used to provide incentives to regulatory authorities to refrain from taking action, and to look the other way, when private parties engage
in activities that are in violation of existing laws, rules and regulations such as those relating to controlling pollution, preventing health hazards, or promoting public safety as in the case of building codes and traffic regulations. Similarly, bribes can be given to favour one party over another in court cases or in other legal and regulatory proceedings.

There is a growing worldwide concern over corruption at the present time.
 

Several factors are responsible for this.
First, a consensus has now been reached that corruption is universal. It exists in all countries, both developed and developing, in the public and private sectors, as well as in non-profit and charitable organizations.

Second, allegations and charges of corruption now play a more central role in politics than at any other time. Governments have fallen, careers of world renowned public figures ruined, and reputations of well-respected organizations and business firms badly tarnished on account of it. The international mass media feeds on it and scandals and improper conduct, especially of those in high places, are looked upon as extremely newsworthy, and to be investigated with zeal and vigour. The rising trend in the use of corruption as a tool to discredit political opponents, the media’s preoccupation with it as a highly marketable commodity, and the general public’s fascination with seeing prominent personalities in embarrassing situations have brought scandalous and corrupt behaviour, a common human frailty, into the limelight of international attention.

Third – and the main issue taken up in this paper – is that corruption can be a major obstacle in the process of economic development and in modernizing a country. Many now feel that it should receive priority attention in a country’s development agenda. This greater recognition that corruption can have a serious adverse impact on development has been a cause for concern among developing countries. In a recent survey of 150 high level officials from 60 third world countries, the respondents ranked public sector corruption as the most severe obstacle confronting their development process (Gray and Kaufmann 1998). 

Countries in the Asia and Pacific region are also very worried about this problem and they are in substantial agreement that corruption is a major constraint that is hindering their economic, political and social development, and hence view it as a problem requiring urgent attention at the highest level. Increasing public interest and concern over corruption have resulted in a large amount of scholarly research on the subject. Admittedly, there are still wide gaps in the current state of information and knowledge on the matter and much more remains to be done. Nevertheless, theoretical and empirical research that has been conducted thus far has yielded fresh insights into the problem. We now have a clearer understanding of the underlying causes of corruption, its consequences, and ideas and approaches on possible measures to combat it. At the same time, a better perspective has been obtained on the reasons why corruption persists in so many countries, and why it is difficult to deal with, although people throughout the world view it with disfavour.

References
Rose-Ackerman, S., Corruption and Government: Causes, Consequences, and Reform. Cambridge University Press, 1999.
Clarke, M. (ed.), Corruption: Causes, Consequences and Control, London: Francis Pinter, 1983.2
Alatas, S. H., Corruption: Its Nature, Causes and Functions, Aldershot: Avebury, 1990.
Karklins, R., The System Made Me Do It: Corruption in Post-Communist Societies. M.E. Sharpe, 2005.
Johnston M., Syndromes of Corruption: Wealth, Power, and Democracy, Cambridge University Press, 2005.
Ledeneva, A. How Russia Really Works: The Informal Practices that Shapes Post-Soviet Politics and Business. Cornell University Press,
2006.
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