Definitions of Corruption

Causes of Corruption

Costs of Corruption

Definitions of Corruption

Defined simply, corruption is the misuse of public power for private profit. However, definitions of corruption and its impact will vary. One cannot assume that corruption always means the same thing or has the same impact or motivation. Normative statements about corruption require a point of view, a standard of "goodness" and a model of how corruption works in particular instances.

… "Corruption" involves behavior on the part of officials in the public sector, whether politicians or civil servants, in which they improperly and unlawfully enrich themselves, or those close to them, by the misuse of the public power entrusted to them. …

There are two quite separate categories of administrative corruption: the first occurs where, for example, services or contracts are provided "according-to-rule" and the second, where transactions are "against-the-rule." In the first situation, an official is receiving private gain illegally for doing something which he or she is ordinarily required to do by law. In the second situation, the bribe is paid to obtain services which the official is prohibited from providing. "According-to-rule" and "against-the-rule" corruption can occur at all levels of the government hierarchy and range in scale and impact from "grand corruption" to more ordinary, small scale varieties.

In practice, public attitudes can overshadow legal definitions of administrative corruption, and public opinion can define corruption in ways which will over-ride law. If public opinion and legal definitions do not conform, the likelihood is that officials will act in accordance with the public view, and in so doing transgress the law. It is therefore crucial that the public be informed and enlightened as to the damage that corruption can cause. —from the TI Sourcebook, 2^nd edition, 1997

Links to related information on Corruption

The Transparency International National Integrity Source Book

Helping Countries Combat Corruption: The Role of the World Bank -- Defining Corruption

Definitions of Corruption (from the Council of Europe)

Legal Definitions of Corruption (from the Council of Europe)

Listing and Definition of Corruption Offenses (from the Council of Europe)

"Comparing Corruption: Conflicts, Standards and Development" by Michael Johnston (Colgate University)  In this paper, Johnston focuses on the differing standards by which countries define corrupt behavior. Using cases drawn from a number of societies and historical periods, he suggests ways to compare corruption even when agreement over what constitutes corrupt behavior is lacking.

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Causes of Corruption

...(C)orruption arises from institutional attributes of the state and societal attitudes toward formal political processes. Institutional attributes that encourage corruption include wide authority of the state, which offers significant opportunities for corruption; minimal accountability, which reduces the cost of corrupt behavior; and perverse incentives in government employment, which induce self-serving rather than public-serving behavior. Societal attitudes fostering corruption include allegiance to personal loyalties over objective rules, low legitimacy of government, and dominance of a political party or ruling elite over political and economic processes.
—from the "USAID Handbook for Fighting Corruption"  (October1998).

Adapted from the "USAID Handbook for Fighting Corruption"  (October1998).

Links to related information on Causes of Corruption

The Transparency International National Integrity Source Book

The USAID Handbook for Fighting Corruption
by Phyllis Dininio with Sahr Kpundeh and Robert Leiken, USAID Centre for Democracy and Governance, Bureau for Global programmes, Field Support, and Research.

From "Helping Countries Combat Corruption: The Role of the World Bank" -- The Causes of Corruption

Corruption and Development (published in Finance & Development, March 1998) By C. Gray and D. Kaufmann
What are the principal causes and costs of corruption? This article examines these questions and suggests specific ways to enhance anti-corruption efforts in developing and transition economies

The causes of corruption: a cross-national study by Daniel Treisman.
Why is corruption - the misuse of public office for private gain - perceived to be more widespread in some countries that others? Different theories associate this with particular historical and cultural traditions, levels of economic development, political institutions, and government policies. This article analyzes several indexes of 'perceived corruption' compiled from business risk surveyes for the 1980s and 1990s. Six arguments find support. Countries with Protestant traditions, histories of British rule, more developed economies, and (probably) higher imports were less 'corrupt'. Federal states were more 'corrupt'. While the current degree of democracy was not significant, long exposure to democracy predicted lower corruption.

Dodging the grabbing hand: the determinants of unofficial activity in 69 countries by Eric Friedman, Simon Johnston, Daniel Kaufmann, and Publo Ziodo-Lobaton.
Across 69 countries higher tax rates are assosiated with less unofficial activity as a percent of GDP but corruption is assosiated with with more unofficial activity. Entrepreneurs go underground not to avoid official taxes but to reduce the burden of bureaucracy and corruption. Dodging the 'grabbing hand' in this way reduses tax revenues as a percent of both official and total GDP. As a result, corrupt governments become small governments and only relatively uncorrupt governments can sustain high tax rates.

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The Major Costs Induced by Corrupt Practice

• A corrupt act represents a failure to achieve the objectives which government seeks (e.g. corruption in appointments induces inefficiency and waste; corruption in the allocation of scarce university places results in best use not being made of a scarce opportunity, etc.);

• Corruption pollutes the environment in which the private sector has to operate, leading either to quick (and excessive) profit-taking in circumstances of unpredictability, or to inward investment being discouraged;

• Corruption represents a rise in the price of administration (the taxpayer must submit to bribery as well, thereby having to pay several times over for the same service);

• If corruption takes the form of a kickback, it serves to diminish the total amount available for public purposes;

• Corruption exerts a corrupting influence on the administrative apparatus, eroding the courage necessary to adhere to high standards of probity ("morale declines, each man asking himself why he should be the sole custodian of morality");

• Corruption in government, perceived by the people, lowers respect for constituted authority and therefore the legitimacy of government;

• If the elite politicians and senior civil servants are widely believed to be corrupt, the public will see little reason why they, too, should not help themselves;

• A barrier to development has been an unwillingness at the political level to take unpopular decisions ("a corrupt official or politician is a self-Centreed individual [unlikely] to jeopardize his prospects for the sake of prosperity for the whole country in the remote future");

• Corruption results in a substantial loss in productive effort as time and energy are devoted to making contacts to outdo the system rather than to enhancing credentials and strengthening one's case objectively;

• Corruption, as it represents institutionalized unfairness, inevitably leads to litigation and calumnious charges with which even the honest official may be blackmailed; and,

• The most ubiquitous form of corruption in some countries--"speed money" or "grease payments"--causes decisions to be weighed in terms of money, not human need.

-- from the TI Source Book, 2^nd Edition, 1997

Links to related information on Costs of Corruption

The Transparency International National Integrity Source Book

The USAID Handbook for Fighting Corruption by Phyllis Dininio with Sahr Kpundeh and Robert Leiken, USAID Centre for Democracy and Governance, Bureau for Global programmes, Field Support, and Research.

The Costs of Corruption
A summary of the major costs and impacts imposed by corrupt behavior

From "Helping Countries Combat Corruption: The Role of the World Bank" -- What economics and political science tell us about the effects of corruption

"The Political Costs of Corruption" by Michael Johnston (Colgate University)
The political costs of corruption weaken a society's ability to reform itself, and to build more open, responsive, credible, and legitimate political institutions. In the short term, corruption estranges people from government, from politics, and from each other. In the long run, they also mean that the anti-corruption potential of politics itself is lost--for while the political process will always need protection in the form of institutional and administrative safeguards, in the long run a vigorous political process can become a significant force in its own right in the struggle against corruption.

"Corruption, Markets, And Reform" by Michael Johnston (Colgate University)
This paper addresses the increasing dominance of market economies in world development, and to the corruption issues raised by that trend. The transition to markets has coincided, in many nations, with a rise in corrupt behavior, and with increasing disagreement over what is and is not permissible in politics and business. The former trend is a serious concern, as it often indicates a weakening or breakdown in established political and business practice. The latter often leads to political and analytical uses of the term "corruption", and to social perceptions and consciousness of corruption problems, that are even broader than the actual extent of corrupt behavior--but which nonetheless are significant problems for stability and development.

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