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How Corruption Affects Development? - Spotlight #4

18/12/2017

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The differences between countries in their level of development have always fascinated and inspired economists. In 1988, Nobel laureate economist Robert E. Lucas wrote:

​"The consequences for human well-being associated with issues such as these (development) are simply staggering: eleven one begins to think about them, it is difficult to think of another thing" .

Today we know that to explain these differences, we have to understand, through the history of the countries, their formal and informal institutions and their political dynamics, how is it that some nations have been able to get out of poverty and build strong democracies, while others remain in vicious circles, where are they? Thus, these few often have an interest in maintaining the status quo and are opposed in a more or less subtle way to possible reforms.

A key aspect to understand the development, or lack of it, is to understand the phenomenon of corruption. Corruption fosters and stabilizes this vicious circle, being both a source of illicit income and power, and a tool to keep a country's institutions weak.
The social sciences have advanced to a lot in explaining the phenomenon of corruption during the last 20 years. It is also proven to have a highly damaging effect on any society, not only in economic terms, but also to undermine the confidence of citizens in their governments, violate human rights and nurture certain undesirable cultural customs; as the "revival culture", for the Colombian case.

While we understand the problem better and better, we are far from understanding what kind of measures are effective against this scourge. Transparency, accountability and citizen participation are preached.

​These measures have a value in themselves, since they are key pieces of a real democracy. But do we really know enough about its unmistakable effects and its effectiveness against corruption?

While they are necessary, they also have undesirable effects: they can make public management inflexible and rigid and can have a negative impact on the intrinsic motivation of officials or managers. We do not trust anybody anymore!

Corruption, more than an abstract concept, is a monster that affects the country at all levels of its institutional life, damaging public finances, education, health and the opportunity for development and progress of peoples.

In the moral aspect, it has, like drug trafficking, the negative effect of becoming a paradigm for the masses, lacking in values, whose members try to ascend economically and socially in this way.

By damaging public finances, it prevents governments from having enough funds to cover large needs, such as food and jobs for the poorest.

Although it is not easy to determine the amount that distracts corruption, it is evident that it represents considerable sums, given the fortunes of many officials who arrived poor in the public administration.

The fight against corruption has become an industry with its own interests and preachers. Suddenly it is time to generate fresh looks, carefully reviewing the evidence of academic research and the lessons learned in practice around the world. This is a worthwhile struggle, but it deserves to be based on informed public policies that go beyond following old sayings
To end corruption and begin to solve those problems that really are a priority for the  society, it is necessary:
  • That people are politically active, stop being indifferent and become more critical (not critical).
  • That they are people who propose ideas and solutions, and who are willing to respect differences and debate.
  • That people become more patriotic, feel for their country not only when some athlete or national team wins a tournament, feel the pain of homeland whenever a compatriot suffers or dies unjustly, due to negligence, lack of management by omission, in short; and have the need to do something so that does not happen again.

And lastly, the most important thing to stop corruption from happening is that people stop thinking that politicians are indispensable for the design and implementation of public policies. People can be organised by neighbourhoods, groups, paths, localities, to design and implement on their own solutions to the problems that their population suffers.

Leo Natasha Barragán
Leo Club of San Francisco, Panamá


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