Cor­rup­tion: Part one

Finweek English Edition - - Portfolio Punts -

RE­PORTS CON­CERN­ING cor­rup­tion could fill a small li­brary. The sub­ject can be sub­di­vided into var­i­ous cat­e­gories: ef­fects of cor­rup­tion, com­pre­hen­sive sum­maries, causes, meth­ods of con­trol, prac­tice in spe­cific coun­tries, need for re­form, re­form meth­ods. Over the decades sev­eral books have been writ­ten on the sub­ject (e.g. El­liot 1997, Kl­it­gaard 1988, Rose-Ackerman 1978, 1999). Ap­par­ently there are over 700 books about cor­rup­tion cur­rently avail­able.

Aca­demic dis­ci­plines ex­am­ine cor­rup­tion from many per­spec­tives: eco­nomics, so­ci­ol­ogy, po­lit­i­cal sci­ence, law, de­vel­op­ment stud­ies, and area stud­ies. How­ever, few ap­proaches at­tempt to look at the prob­lem in a holis­tic way. In fact, in the in­tro­duc­tion to their vol­ume on cor­rup­tion Har­ris-White and White (1996) re­fer to a ”… be­wil­der­ing ar­ray of al­ter­na­tive explanations, ty­polo­gies and reme­dies …” that have been used to in­ves­ti­gate cor­rup­tion. They fur­ther state that ”…while this work is quan­ti­ta­tively im­pres­sive it has not cul­mi­nated in a par­a­digm of anal­y­sis which is use­ful…”.

The most ob­vi­ous con­se­quence of cor­rup­tion with re­spect to in­ter­na­tion­ally funded de­vel­op­ment projects is the de­creased avail­abil­ity of funds for le­git­i­mate project work and con­se­quent in­creased costs to ac­com­plish stated project goals, if they are in fact ever ac­com­plished. That is, as cor­rup­tion be­comes more preva­lent, le­git­i­mate project needs com­pete with il­le­git­i­mate uses of project funds.

Sadly, theft of money and de­creased value of a par­tic­u­lar project are only mi­nor ef­fects of a cor­rupt sys­tem. As cor­rup­tion be­comes rou­tine many other fac­tors con­spire to make it com­plex and self re- en­forc­ing. A cul­ture of cor­rup­tion de­vel­ops. In­di­vid­u­als who would oth­er­wise be hon­est are in­flu­enced by cor­rupt in­di­vid­u­als both di­rectly and in­di­rectly.

Favouritism by a cor­rupt boss to­ward em­ploy­ees likely to pro­vide pay­ments in­flu­ences th­ese em­ploy­ees and forces them to par­tic­i­pate in cor­rupt prac­tices. Peo­ple who do not par­tic­i­pate do not re­ceive pro­mo­tions and pay raises. In­di­vid­ual ben­e­fits that cor­rup­tion yield, lead to the hoard­ing of key project man­age­ment po­si­tions by rel­a­tively few in­di­vid­u­als. Loy­alty rather than qual­i­fi­ca­tion de­ter­mines the as­sign­ment of other staff to project ac­tiv­i­ties. This will af­fect many re­lated, con­cur­rent projects as key cor­rupt in­di­vid­u­als and their un­der­lings ac­quire ad­di­tional project as­sign­ments.

In or­der to best par­tic­i­pate in a cor­rupt sys­tem a per­son needs to be em­ployed in a man­age­ment po­si­tion.

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