Corruption in amateur words would be placing self-interests above social interests.
Corruption is an ancient problem that has evolved with the advancement of kingdoms and societies.Texts as old as Arthasastra state the impossibility of government servants to ‘not’ consume, atleast a bit of the state revenue.
However, is corruption all that adverse as it is portrayed ?
Asian countries such as China and Indonesia showcase increased levels of economic growth despite high levels of corruption.The hypothesis that corruption “greases the wheels” for economic growth suggests the same.
Firstly corruption serves as a silent redemption to few of the ill-framed bureaucratic policies, that would have discouraged the trade otherwise.
For instance, imported goods held up at ports due to stringent policies cause production delays and a huge losses to a firm.So the business decides to bribe the port official and thus saving the firm of high costs and speeding up(greasing) the trade process.
Another view is that corruption can make government decision making more effective, by replicating a situation of competitive auction, where the the most generous briber is given the contract.This is however an advantage only with the assumption of correlating the capacity to bribe with the firms’ efficiency.
Other concerns of a poor bureaucratic system includes the quality of the government officials.Lack of motivation and inadequate wages might discourage potential candidates from joining.Such supplements can attract workers who would have otherwise opted other fields of profession.
Finally corruption is considered to create a balance between the pursuit of public and private interests, onlooking those officials who might not be completely dedicated to working towards common interests.
An ‘entirely pure‘ state devoid of any corrupt practises was considered impossible to reach by intellectuals such as Plato.If the standard of non-corrupt government is placed so high and unachievable, then what is the purpose of condemning corruption?
However evidently on a long run and in a large scale the ideal effects of a “self-serving” regime(a corrupted system) is undoubtedly adverse to any economy.Such immoral practises are likely to encourage those practising it to indulge in more illicit activities and hence is termed to “sand the wheels” of growth.
Corruption is claimed to hamper with sustainable development and cause.Countries hence work for reducing all forms of corruption and work on the recovery and return of stolen assets(demonetisation in India 2016). Developing a transparent system of financial working has become mandatory for many of the economies.The rise of business cartels and their influence in political decision making might grow to become unavoidable.
Other unfavourable outcomes of corruption might include the accumulation of resources in few hands(rich becoming richer, and the poor becoming poorer).Thus constituting to a misallocation of resources and decreased economic development.The African Union estimated a 25% of its GDP lost to corruption(UNODC 2015) .These vast amounts could be otherwise used by the state to improve standards of education, health or housing.
As long as resources are allocated in adherence to the greed of individuals ,it is always going to be misallocated.