Running Head: CORRUPTION AND ECONOMIC DEVELOPMENT 1

CORRUPTION AND ECONOMIC DEVELOPMENT

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How would you explain the correlation between the amount of corruption in a country and

economic development?

Primarily, corruption originates form the term misuse of public power/ moral decay. This

has developed to the act of bribery which included the public servant solely benefiting from the

public resources. This has a deep relationship with the economic development. (Lash, 2014).

Economic development of a nation grows when the resources of the country are uniformly

distributed therefore when these resources are consumed by few greedy public servants this

negatively affects the economic development of the nation in general. The two normally relates

in many ways where by some of the ways are not observable.

Corruption is well referred to as economic crime. This is because examining the most

corruption cases which are traced are associated with low economic growth of a nation. These

corruption practices include the following; low wages, low purchasing power and also limited

labor resources. It is good to note that these situations are not the real causes of the corruption

but they do affect the growth of s country at large. When a nation is experiencing some economic

deficiencies the low wages to the public servants will lead then to look for other unjustified

methods to look for more money which will be comparable to the private sectors (Wei, 2017).

Defending ones economies usually leads to internal corruption. This is because when this

happens the tariffs barriers and also other set protective measures usually encourage the private

sectors to offer bribes to the public officer in order to request for favors from them to avoid these

protective measures and the tariffs barriers. The market economy indicators are negatively

correlated to the level of corruption. This means that when there are levels of corruption the

market economy goes down and vice versa.

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Corruption usually leads to the economic growth destruction, this is because corruption

reduces the incentives which belongs to the domestic and mainly the foreign investments. The

foreign investors usually goes through the nation’s history and also the stability of the economy.

Then they make decision of investing in a nation. When the nation faces corruption history this

creates fear in the investors since the economy of a nation cannot be stable when the levels of

corruptions rea very high (Dearden, 2016).

Allocation of funds to the different regions of a nation usually contributes largely on the

public investment and then corruption on the other hand usually encourages on unproductive

investments this is because it usually has the wrong composition of the public expenditure

through reducing the productivity of the public investment. This is done through lowering the

quality of the infrastructure and also the public services. There are also cases of the increased

cost of the goods and services which leads to the deterioration of the quality of the services

which are offered (Leff, 2015).

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References:

Lash, N. A. (2014). Corruption and economic development. The Journal of Economic

Asymmetries, 1(1), 85-109.

Wei, S. J. (2017). Corruption in economic development: Beneficial grease, minor annoyance, or

major obstacle?. The World Bank.

Dearden, S. J. (2016). Corruption and economic development.

Leff, N. H. (2015). Economic development through bureaucratic corruption. American

behavioral scientist, 8(3), 8-14.