Types and Causes of corruption, effects of corruption

Like that of several other socio-economic offences, corruption stands out as an offence which affects the community as a whole. It is not just an offence between the perpetrator of a traditional crime like murder, theft or rape and an innocent victim. In fact and reality the bribe-giver and the bribe-taker are equally guilty. Although, corruption undoubtedly affects the morality of the people in general, but its overwhelming impact is on the economic Health of a nation and accordingly corruption will have to be classified as an ‘economic offence’. It goes without saying that the poor strata of our Society, which has limited paying capacity, suffers the most due to administrative corruption and besides this, the economy of a country beset with the evil of corruption is affected due to the generation of unaccounted or ‘black Money‘ which is a major factor responsible for unbridled Inflation. The offence of corruption appears to have been regarded more as an economic evil rather than immoral hazard and accordingly corruption deserves to be classified as an economic offence.

It is difficult to apportion the blame for corruption as between officers at the highest level and their subordinates. It is true that economic deprivation in the middle and lower class officials in the past may have led to a large number of corrupt practices but this, in itself, does not absolve the superiors whose lust for higher and higher standard of living .is never satiated. Then again, corruption like sacrifices, starts at the top and percolates down to the bottom.

One more distinguishing feature of the offence of corruption is that the victim as also the beneficiary of the offence are equally interested in maintaining utmost secrecy about their transactions. This aggravates the difficulty on the part of the enforcement staff in obtaining vital evidence which will help the prosecutor to secure conviction in deserving cases.

CORRUPTION : DEFINITION
• The simplest definition of corruption is improper or selfish exercise of power and influence attached to a public office or to a special position in public life. In the legalistic jargon of the Indian Penal Code, a corrupt person is one who “being of expecting to be a public servant, accepts or obtains, or agrees to accept, or attempts to obtain, from any person, for himself or for any other person, any gratification whatever, other than legal remuneration, as a motive or reward for doing or forbearing to do any official act, or for showing or forbearing to show, in the exercise of his official functions, favour or disfavour to any person, or for rendering or attempting to render any service or disservice to any person, with the Central or any State Government or Parliament or the Legislature of any State, or with any public servant as such”.
In other words, any act of commission or omission by a public servant for securing pecuniary or other material advantage directly or indirectly for himself or his family or friends is corruption.

• According to Peter H. Odegard , corruption is in a sense a product of the way of life of an acquisitive society where ‘money talks’, where what ‘works’ is justified, and where people are judged by what they have rather than what they are. The over-emphasis on the general cultural milieu may suggest that spiritual values as distinct from material pursuits are an antidote to corruption.

• A broad definition is that “corruption is the betrayal of public trust for individual of group gain. This definition, it is needless to say, does not define the content of ‘public trust’ and accordingly it has a tendency to indicate that it speaks of or it presupposes some sources of wealth which a public servant can take or use to his private advantage. Accordingly, therefore, the definition appears to be more suited to cases of misappropriation of public funds by a public servant, which represents only a category of corruption. From this angle, the position will not be very much different if corruption is defined as misappropriation of government properties or funds through criminal breach of trust”.

• Indeed, there are thinkers who feel that corruption in administration has certain positive aspects too since it helps in speeding up the administrative process. This may be partly true only in the context of speed money, but that is only a part of the story. It is now widely known that a large portion of public funds are being siphoned off by responsible public servants and even bank officials entrusted with the task of advancing loans to lowest category of farmers and entrepreneurs are deducting a sizeable portion of the loan in the name of commission.

CAUSES OF CORRUPTION
• Corruption is an offence like that of many other offences punishable under the criminal law of our country. Basically, therefore, it is the sociologists and the criminologists who can delve deep into causes of corruption. For that matter, the causes of crime, in general, equally applied to the offence of corruption. However, it can perhaps be suggested that certain special socio-economic and political factors do accentuate the tendency to commit these offences which could be bracketed together under the title of corruption. The aforesaid factors can be summarised in the following works.
• The aftermath of the second World War accompanied by scarcities, controls and the flush of easy money was perhaps one of the factors responsible for corruption. The second factor was the fall in real income of the various categories of public servants.
According to Myrdal, the extent of corruption has a direct bearing on the stability of the government of a state.
He thinks that the main factors responsible for increasing corruption in the developing countries
are :
• Little loyalty to the community as a whole, whether on the local or the national level. This, according to Myrdal, implies stronger loyalty to less inclusive groups family, cast, ethnic religious or linguistic community.
• The state of transition from colonial to self government.
• Wide discretionary powers and low level of real wages.
• Cumulative effects working within the system of corruption itself.

Some of the major factors that have been regarded to be responsible for corruption by different scholar are also worth taking into account:

• A defective Electoral System which had led to an unholy alliance between the politicians and big businessmen. The parties raise funds for the election expenses from business houses in exchange for favours done or to be done in future. The problem aggravates alongwith the increase in the cost of election.Unscruplous industrialists, businessmen, contractors, tax-evaders and smugglers are too ready to provide the finance for successive Elections. Where ministers collect funds for their party, executive officers naturally get involved and are compelled to protect the saiderring persons. Obviously, therefore, some officials of the administration secure the protection of politicians and such favoured officials get the best positions and promotions. In their turn these officials use corrupt means and Nepotism to please their political masters.
• Administrative delays and read-tapism is another major cause of corruption and this has led to the dishonest practice of giving speed money.
• Rapid industrialization and consequent Urbanization has changed our values in such a way as to enhance the importf oece of status through possession of money.
• The emergence of a class of white-collar criminals indulging in Tax Evasion, under-invoicing, over-invoicing of export and import, substandard performance of contracts, hording, profiteering and blackmarketing etc. have afforded unprecendented opportunities for corruption to public servants.
• In an economy of expending money circulation, moral and ethical values have considerably slackened resulting again in corruption. Misplaced sympathy for corruption public servants is another factor for encouraging corruption.
• It is also said that existing anti-corruption law agencies are totally inadequate to prevent higher-level corruption.
• Inadequate financial Resources by way of monthly salary resulting in economic deprivation coupled with the increase of consumerism and commercialism in the Environment is another factor for corruption.
• Social obligation towards the members of one’s family, the customary practice of giving dowry for a daughter’s marriage and the hankering for social status have been responsible for corruption to a certain extent. It is true that no person is corrupt at his birth but the environment in which he lies including the various institutions and associations around him make him learn the techniques and methods of corruption. The Santhanam Committee had aptly pointed out that corruption can exist only if there is some one willing to corrupt and capable of corrupting.

BRIBERY AND CORRUPTION
• A colloquial word associated with corruption is that of ‘Bribery’ and hence, it becomes appropriate to clarify the meaning of the latter. Although the words ‘bribery’ and ‘corruption’ seem to have been used synonymously in the past but the former seems to have narrower cannotation. It is bribery to give a public servant money or property of any value in exchange for an agreement by the public official to do or refrain from doing something that is against his official duty. At the same time it is bribery for a public official to agree to do or not to do something in derogation of his duty in of) exchange for money or property. Broadly speaking, corruption refers to all sorts of dishonest dealings including bribery.
• It comprehends all “improper or selfish exercise of power and influence attached to a public office or to the special position one occupies in public life”. This is obviously a comprehensive meaning of corruption and it is in this sense that the word ‘corruption’ has been used in this work. It is needless to say, that the inchoate offences of attempt and abetment in relation to the aforesaid conducts will be naturally included in this study.

Types Of Corruption

Systemic corruption

As opposed to exploiting occasional opportunities, endemic or systemic corruption is when corruption is an integrated and essential aspect of the economic, social and political system, when it is embedded in a wider situation that helps sustain it. Systemic corruption is not a special category of corrupt practice, but rather a situation in which the major institutions and processes of the state are routinely dominated and used by corrupt individuals and groups, and in which most people have no alternatives to dealing with corrupt officials. Examples might include contemporary Bangladesh, Nigeria, Kenya, Cameroon and many others. (Michael Johnston: Fighting Systemic Corruption: Social Foundations for Institutional Reform.)

Sporadic (individual) corruption

Sporadic corruption is the opposite of systemtic corruption. Sporadic corruption occurs irregularly and therefore it does not threaten the mechanisms of control nor the economy as such. It is not crippling, but it can seriously undermine morale and sap the economy of resources.

Political (Grand) corruption

Political corruption is any transaction between private and public sector actors through which collective goods are illegitimately converted into private-regarding payoffs. Political corruption is often used synonymously with “grand” or high level corruption, distinguished from bureaucratic or petty corruption because it involves political decision-makers. Political or grand corruption takes place at the high levels of the political system, when politicians and state agents entitled to make and enforce the laws in the name of the people, are using this authority to sustain their power, status and wealth. Political corruption not only leads to the misallocation of resources, but it also perverts the manner in which decisions are made. Political corruption is when the laws and regulations are abused by the rulers, side-stepped, ignored, or even tailored to fit their interests. It is when the legal bases, against which corrupt practices are usually evaluated and judged, are weak and furthermore subject to downright encroachment by the rulers.

Grand corruption

High level or “grand” corruption takes place at the policy formulation end of politics. It refers not so much to the amount of money involved as to the level in which it takes place: grand corruption is at the top levels of the public sphere, where policies and rules are formulated in the first place. Usually (but not always) synonymous to political corruption.

Petty corruption

Small scale, bureaucratic or petty corruption is the everyday corruption that takes place at the implementation end of politics, where the public officials meet the public. Petty corruption is bribery in connection with the implementation of existing laws, rules and regulations, and thus different from “grand” or political corruption. Petty corruption refers to the modest sums of money usually involved, and has also been called “low level” and “street level” to name the kind of corruption that people can experience more or less daily, in their encounter with Public Administration and Services like hospitals, schools, local licensing authorities, police, taxing authorities and so on.

Legal and Moral Corruption

Corruption is derived from the Latin verb rumpere, to break. According to this approach, corruption is where the law is clearly broken. This requires that all laws must be precisely stated, leaving no doubts about their meaning and no discretion to the public officials. A legal interpretation of corruption provides a clearly demarcated boundary between what is a corrupt activity and what is not. ‘If an official’s act is prohibited by laws established by the government, it is corrupt; if it is not prohibited, it is not corrupt even if it is abusive or unethical’.
The legal approach provides a neutral and static method of adjudicating potentially emotive and perception determined concepts of corruption. An understanding of corruption from law perspective serves to underline a deterioration of self-regulated behaviour and a dependence on the legal approach to determine right from wrong. The complexities of modern governance and a proliferation of corruption scandals have corresponded with a proliferation of complex corruption legislation.
Legislating for behaviour warrants focus upon the legality of an action and not the morality of that same action. Morality is increasingly being legislated for in the absence of and a loss of faith in self regulated behaviour. Although an act is committed within legal parameters it may lie outside moral boundaries. A corrupt act can be camouflaged by lawful justification. For example, ‘undue emphasis on narrow legalism has obscured more subtle yet costly manifestations of misgoverance’ where ‘“legal corruption” may be more prevalent than illegal forms’.
From this perspective corruption encompasses undue influence over public policies, institutions, laws and regulations by vested private interests at the expense of the public interest. Cultural change, rather than legal change, may be necessary to impede corrupt behaviour. Non-corrupt actions may be within the letter of the law but do not account for the spirit of the law. The legal approach diminishes the role of moral discretion and is constrained by clearly defined edicts.

Effects of corruption

The impact of corruption on developing countries cannot be overemphasized. The results areoften disastrous. The eleven year civil conflict in Sierra Leone, for instance was largelyattributed to pervasive corruption in all spheres of governance. The occurrence of corruption inlarge scale reflects in many areas of development and is intrinsically linked with underdevelopment. Poor conditions of service as is the case in many developing countries open thedoor to bribery. Corrupt officials often accept substandard quality of service because ofkickbacks thus depriving the country of value added service from contractors and consequently resulting to the implementation of water washed roads or schools. Health care facilities remaininadequate and inaccessible because most times, drugs meant for especially children and womenparticularly in provincial clinics and hospitals could be easily seen on the shelves of privatepharmacies.One of the greatest impacts of corruption normally arises out of the choices and priorities ofgovernments. This occurs when the real development priorities of a country are often neglectedin favour of those that generate the greatest personal gains for the decision makers. Here, it isclearly evident that many projects have become white elephants and easy route for personalenrichment. When loans taken by governments on the pretext of undertaking some projects arediverted to private accounts and coffers, the attendant effect is that such loans would have to bepaid with interest and at the same time increasing the debt burden of the country.

ENVIRONMENTAL AND SOCIAL EFFECTS OF CORRUPTION

Corruption facilitates environmental destruction. Corrupt countries may formally have legislationto protect the environment; it cannot be enforced if officials can easily be bribed. The sameapplies to social rights worker protection, unionization prevention, and child labor. Violation ofthese laws rights enables corrupt countries to gain illegitimate economic advantage in theinternational market.The Nobel Prize-winning economist Amartya Sen in India has observed that “there is no suchthing as an a political food problem.” While drought and other naturally occurring events maytrigger famine conditions, it is government action or inaction that determines its severity, andoften even whether or not a famine will occur. Governments with strong tendencies towardskleptocracy can undermine Food Security even when harvests are good. Officials often steal stateproperty. In Bihar, India, more than 80% of the subsidized food aid to poor is stolen by corruptofficials. Similarly, food aid is often robbed at gunpoint by governments, criminals, and warlordsalike, and sold for a profit. The 20th century is full of many examples of governmentsundermining the food security of their own nations – sometimes intentionally.

ECONOMIC EFFECTS OF CORRUPTION

Corruption undermines Economic Development by generating considerable distortions andinefficiency. In the private sector, corruption increases the cost of business through the price ofillicit payments themselves, the management cost of negotiating with officials, and the risk ofbreached agreements or detection. Although some claim corruption reduces costs by cuttingbureaucracy, the availability of bribes can also induce officials to contrive new rules and delays.Openly removing costly and lengthy regulations are better than covertly allowing them to bebypassed by using bribes. Where corruption inflates the cost of business, it also distorts theplaying field, shielding firms with connections from competition and thereby sustaininginefficient firms.Corruption also generates economic distortions in the public sector by diverting publicinvestment into capital projects where bribes and kickbacks are more plentiful. Officials mayincrease the technical complexity of public sector projects to conceal or pave the way for suchdealings, thus further distorting Investment. Corruption also lowers compliance withconstruction, environmental, or other regulations, reduces the quality of government services andinfrastructure, and increases budgetary pressures on government.

Corruption is a form of dishonesty or a willingness to act dishonestly in order to gain an advantage. It can take many forms, including bribery, extortion, nepotism, cronyism, embezzlement, conflicts of interest, misuse of public funds, fraud, racketeering, and money laundering.

Corruption can have a devastating impact on individuals, businesses, and societies. It can lead to economic damage, social unrest, political instability, Human Rights abuses, Environmental Degradation, weakened institutions, undermining of Democracy, loss of trust in government, increased crime, reduced investment, increased POVERTY, reduced economic Growth, and increased inequality.

There are many causes of corruption, including poverty, lack of Education, lack of transparency, weak institutions, weak Rule of Law, lack of accountability, lack of political will, and culture of impunity.

There are also many things that can be done to fight corruption, including strengthening institutions, promoting Transparency and Accountability, improving education, reducing poverty, and building a culture of Integrity.

Corruption is a complex problem, but it is one that can be solved. By understanding the causes of corruption and the effects it can have, we can take steps to fight it and build a more just and equitable world.

Table of Contents

Types of Corruption

There are many different types of corruption, but some of the most common include:

Bribery: This is when someone offers or gives money or other benefits to a public official in order to influence their decision-making.
Extortion: This is when someone uses threats or force to obtain money or other benefits from another person.
Nepotism: This is when someone gives preferential treatment to a family member or friend in hiring, promotion, or other matters.
Cronyism: This is when someone gives preferential treatment to a business associate or friend in hiring, promotion, or other matters.
Embezzlement: This is when someone steals money or other assets that have been entrusted to them.
Conflicts of interest: This is when someone has a personal interest in a matter that they are supposed to be impartial about.
Misuse of public funds: This is when someone uses public money for their own personal gain.
Fraud: This is when someone deceives another person in order to gain something of value.
Racketeering: This is when someone uses organized crime to extort money or other benefits from others.
Money laundering: This is when someone tries to hide the origins of illegally obtained money.

Causes of Corruption

There are many factors that can contribute to corruption, including:

Poverty: When people are poor, they may be more likely to engage in corruption in order to survive.
Lack of education: People who are not educated about the dangers of corruption may be more likely to engage in it.
Lack of transparency: When government activities are not transparent, it is easier for corruption to occur.
Weak institutions: When institutions such as the police and the judiciary are weak, it is more difficult to fight corruption.
Weak rule of law: When the rule of law is weak, people may feel that they can get away with corruption.
Lack of accountability: When people in power are not held accountable for their actions, it is more likely that corruption will occur.
Lack of political will: When political leaders are not committed to fighting corruption, it is difficult to make progress.
Culture of impunity: When people believe that they will not be punished for corruption, they are more likely to engage in it.

Effects of Corruption

Corruption can have a devastating impact on individuals, businesses, and societies. Some of the effects of corruption include:

Economic damage: Corruption can lead to economic damage by discouraging investment, distorting markets, and increasing costs.
Social unrest: Corruption can lead to social unrest by creating a sense of injustice and inequality.
Political instability: Corruption can lead to political instability by undermining trust in government and institutions.
Human rights abuses: Corruption can lead to human rights abuses by allowing those in power to abuse their positions for personal gain.
Environmental degradation: Corruption can lead to environmental degradation by allowing those in power to exploit Natural Resources for personal gain.
Weakened institutions: Corruption can weaken institutions by undermining their ability to function effectively.
Undermining of democracy: Corruption can undermine democracy by allowing those in power to manipulate the political process for their own benefit.
Loss of trust in government: Corruption can lead to loss of trust in government by making people believe that government is not working in their best interests.
Increased crime: Corruption can lead to increased crime by creating an environment in which criminals can operate with impunity.
Reduced investment: Corruption can lead to reduced investment by discouraging businesses from investing in countries where corruption is high.
Increased poverty: Corruption can lead to increased poverty by making it more difficult for people to escape poverty.
Reduced economic growth:

Types of corruption

Bribery: Giving or receiving money or other benefits to influence the actions of a public official.
Nepotism: Hiring or promoting relatives or friends based on their relationship rather than their qualifications.
Cronyism: Giving preferential treatment to friends or associates, even if they are not qualified for the job.
Extortion: Using threats or force to obtain money or other benefits.
Embezzlement: Stealing money or other assets that have been entrusted to you.
Conflict of interest: Using your position for personal gain, even if it is not illegal.
Misuse of public funds: Using public money for personal or political purposes.
Abuse of power: Using your position to intimidate or harm others.

Causes of corruption

Poverty: People who are poor may be more likely to engage in corruption in order to survive.
Lack of education: People who are not educated may not understand the laws or the consequences of corruption.
Weak institutions: Corrupt institutions, such as the police or the judiciary, can make it difficult to fight corruption.
Lack of transparency: When government activities are not transparent, it is easier for corruption to occur.
Weak rule of law: When the rule of law is weak, people may be more likely to believe that they can get away with corruption.
Culture of impunity: When people who engage in corruption are not held accountable, it sends the message that corruption is acceptable.

Effects of corruption

Economic harm: Corruption can lead to economic harm by reducing investment, increasing costs, and distorting markets.
Social harm: Corruption can lead to social harm by undermining trust in government, institutions, and the rule of law.
Political harm: Corruption can lead to political harm by weakening democracy and undermining the legitimacy of governments.
Environmental harm: Corruption can lead to environmental harm by allowing polluters to operate without regulation and by diverting resources away from environmental protection.
Human rights harm: Corruption can lead to human rights harm by allowing abuses to go unpunished and by undermining the ability of people to access basic services.

Types of Corruption

Bribery: This is the act of offering, giving, receiving, or soliciting anything of value to influence the actions of an official or other person in charge of a public or legal duty.
Embezzlement: This is the act of taking money or property entrusted to one’s care for dishonest purposes.
Extortion: This is the act of obtaining something, especially money, through force or threats.
Fraud: This is the act of deceiving someone in order to gain something, especially money.
Nepotism: This is the practice of favoring relatives or friends in appointments or promotions.
Patronage: This is the practice of using one’s power or influence to help or promote someone, especially a friend or relative.
Conflict of interest: This is a situation in which a person has a personal or financial interest that could interfere with their ability to make impartial decisions.
Insider trading: This is the buying or selling of a security based on non-public information.
Bribery of foreign officials: This is the act of offering, giving, receiving, or soliciting anything of value to influence the actions of a foreign official in order to obtain or retain business or other improper advantage.
Money laundering: This is the process of concealing the origins of illegally obtained money by introducing it into the financial system in a way that makes it appear legitimate.

Causes of Corruption

Poverty: Corruption is often seen as a way to get ahead in life when other opportunities are limited.
Lack of education: People who are not educated about the law or their rights are more likely to be victims of corruption.
Weak institutions: Corruption can thrive in countries with weak institutions, such as a lack of an Independent Judiciary or a corrupt police force.
Culture of impunity: When people believe that they will not be punished for corruption, they are more likely to engage in it.
Economic inequality: When there is a large gap between the rich and the poor, people may feel that they have no other choice but to engage in corruption in order to survive.

Effects of Corruption

Economic harm: Corruption can lead to a loss of government revenue, increased costs for businesses, and a decrease in foreign investment.
Social harm: Corruption can undermine trust in government and institutions, lead to social unrest, and increase crime rates.
Political harm: Corruption can weaken democracy and lead to the rise of authoritarian leaders.
Environmental harm: Corruption can lead to the destruction of natural resources, the pollution of air and water, and the degradation of Ecosystems.
Human rights abuses: Corruption can lead to the denial of basic human rights, such as the right to education, healthcare, and Justice.