Political corruption

:This article is about political corruption. For other uses, see Corruption (disambiguation)

Negative effects

Effects on politics, administration, and institutions

Corruption poses a serious development challenge. In the political realm, it undermines democracy and good governance by flouting or even subverting formal processes. Corruption in elections and in legislative bodies reduces accountability and distorts representation in policymaking, corruption in the judiciary compromises rule of law, and corruption in public administration results in the unfair provision of services. More generally, corruption erodes the institutional capacity of government as procedures are disregarded, resources are siphoned off, and public offices are bought and sold. At the same time, corruption undermines the legitimacy of government and such democratic values as trust and tolerance. See also: Good governance

Related Topics:
Elections - Good governance

~ ~ ~ ~ ~ ~ ~ ~ ~ ~

Economic effects

Corruption also undermines economic development by generating considerable distortions and inefficiency. In the private sector, corruption increases the cost of business through the price of illicit payments themselves, the management cost of negotiating with officials, and the risk of breached agreements or detection. Although some claim corruption reduces costs by cutting red tape, an emerging consensus holds that the availability of bribes induces officials to contrive new rules and delays. Where corruption inflates the cost of business, it also distorts the playing field, shielding firms with connections from competition and thereby sustaining inefficient firms.

~ ~ ~ ~ ~ ~ ~ ~ ~ ~

Corruption also generates economic distortions in the public sector by diverting public investment into capital projects where bribes and kickbacks are more plentiful. Officials may increase the technical complexity of public sector projects to conceal or pave way for such dealings, thus further distorting investment. Corruption also lowers compliance with construction, environmental, or other regulations; reduces the quality of government services and infrastructure; and increases budgetary pressures on government.

~ ~ ~ ~ ~ ~ ~ ~ ~ ~

Economists argue that one of the factors behind the differing economic development in Africa and Asia is that in the former, corruption has primarily taken the form of rent extraction with the resulting financial capital moved overseas rather invested at home (hence the stereotypical, but sadly often accurate, image of African dictators having Swiss bank accounts). Corrupt administrations in Asia like Suharto's have often taken a cut on everything (requiring bribes), but otherwise provided more of the conditions for development, through infrastructure investment, law and order, etc. University of Massachusetts researchers estimated that from 1970 to 1996, capital flight from 30 sub-Saharan countries totalled $187bn, exceeding those nations' external debts.http://www.newstatesman.com/Economy/200503140015 (The results, expressed in retarded or suppressed development, have been modelled in theory by economist Mancur Olson.) In the case of Africa, one of the factors for this behaviour was political instability, and the fact that new governments often confiscated previous government's corruptly-obtained assets. This encouraged officials to stash their wealth abroad, out of reach of any future expropriation.

Related Topics:
Economic development - Africa - Asia - Rent extraction - Financial capital - Suharto - University of Massachusetts - Capital flight - Sub-Saharan - Mancur Olson - Expropriation

~ ~ ~ ~ ~ ~ ~ ~ ~ ~

General national welfare

Political corruption is widespread in many countries, and represents a major detriment to the well-being of their citizens. Political corruption means that government policies tend to benefit the givers of the bribes, not the general public. An example is how politicians would draft laws that protect large corporations while hurting small businesses. These "pro-business" politicians are simply returning favours to those large corporations that contributed heavily to their election campaigns. In a similar manner, many special interests have been shielded from legislative restrictions in the United States as this bribery in disguise is de facto legalised.

Related Topics:
Government - Special interests - United States

~ ~ ~ ~ ~ ~ ~ ~ ~ ~