To define corruption you need to consider more than just the lexical definition of corruption, you need to consider the impact, causes and effects of corruption on a personal level as well as a societal level. For the purposes of this paper we will only be considering the conditions which support a corrupt environment. As well, corruption is simply defined as using public office for private gain. From this definition we can posit that corrupt behavior would include bribery, fraud, extortion, nepotism, embezzlement, patronage, influence peddling and the appropriation of public assets for private use.
Of the 8 possible corrupt behaviors only two can be performed alone, fraud and embezzlement, whilst the other 6 types of behavior require at least two parties. The causes of these 6 types of behavior will be encouraged in the presence of the following activities and help us define corruption:
- Awarding government contracts – easily influenced by bribes
- Distribution of government benefits – bribes can influence which areas credit subsidies are applied as well as licensing and lucrative permits, the distribution of funds as well as preferential treatment in the acquirement of government enterprises slated to be privatized.
- Collection of government revenue bribes can substantial reduce taxes, fees, duties, dues as well as government owned utility bills.
- Fulfillment of Government Regulatory requirements bribes can speed up bureaucratic hurdles and inspire burdensome creation of rules and regulations.
- Influencing outcomes of proceedings – bribes can prevent action when violations of rules and regulations have taken place in regard to health and public safety, traffic and building standards or pollution as well as decide the outcome of proceedings.
The Klitgaard Corruption equation, C = R + D A, can be used to identify areas and levels of possible corruption with substantially accurate predictions. The C stands for corruption, the R stands for economic rent, and the D stands for discretionary powers while the A stands for accountability.
Economic rent is the difference in the amount one can earn from holding office and participating in corrupt activities and the amount one can earn if not holding office. A publicly elected minister can make substantial income in kickbacks for awarding contracts, voting for or against issues and distributing resources while in office. No in office, if they can only drive a taxi for a livelihood, then the economic rent would be much greater than a person that could earn much more out of office such as someone that is independently wealthy, owns several companies or is a lawyer.
Discretionary powers can never be fully eliminated due to revenue constraints, technology advancements and interpretation of rules. For instance in deciding the tax on a DVD import as a luxury to be watched in the comfort of your home, a language tool to be used in a school or a religious tool to be used spiritually in church is discretionary to a degree. Information of the customs appraisal cost of computer parts or electronics would be costly and not timely today. In removing discretionary powers a government could remove valuable economic advantages and lose external and internal investment.
Accountability is the level of responsibility and accountability administrators have in their governance of rules and regulations. When you help finance your local churchs or mosques prayer wing addition, you expect a public explanation of objectives, benefits, plans and costs as well as periodic progress reports and a fully disclosed properly audited account final report after completion.
If asked, as a condition of enrollment, for a large contribution for school upgrades and improvement of the welfare of students, administrative staff and teachers with no receipt, no financial statements or information on how the money was spent, then there is no accountability. The more accountability there is the less opportunity and conditions will exist for corruption flourish.
From the equation C = R + D A, we see that corruption will flourish in an environment:
- Riddled with complex laws, regulations, administrative orders and rules which will create more opportunities for generating economic rent particularly if applied in an inconsistent, secretive, non-transparent and selective manner.
- Where discretionary powers are great, interpretations of rules are vague as to how to be applied, to whom, in what manner with powers to amend, alter, supplement or rescind rules.
- Where there are no mechanisms to hold administrators accountable for their actions.
At this point, it is easier to define corruption levels based on the conditions that exist. Its easier to combat the potential for possible corruption and develop policies to curb corruption. Unfortunately when you view any of the articles on corruption present on the Internet or read any paragraph on corruption in newspapers, we quickly see that this equation is not being implemented (UNESCAP, 2000).
The ideas of this article are based on the works of:
UNESCAP. (2000, December 1). CORRUPTION: CAUSES, CONSEQUENCES AND CURES. Retrieved August 19, 2012, from United Nations Economic and Social Commission for Asia and the Pacific:
