Corruption: its nature, causes and consequences

• Definition of corruption
• Components of corruption
• Causes of corruption
• Ways of fighting corruption

Definition of corruption
Corruption is a general concept describing any organized, interdependent system in
which part of the system is either not performing duties it was originally intended to, or
performing them in an improper way, to the detriment of the system's original purpose.
‘Corruption is the abuse of power by a public official for private gain.’ Corruption, when
applied to officers, trustees, etc., signifies the inducing a violation of duty by means of
pecuniary considerations.

Specific types of corruption include:

• Political corruption, or the dysfunction of a political system or institution in which

government officials, political officials or employees seek illegitimate personal
gain through actions such as bribery, extortion, cronyism, nepotism, patronage,
graft, and embezzlement. Political corruption is a specific form of rent seeking
(which is not to be confused with property rental).
• Data corruption, or an unintended change to data in storage or in transit.
• Linguistic corruption, or the change in meaning to a language or a text introduced
by cumulative errors in transcription or changes in the language speakers'
comprehension. A word that has adopted from another language but whose
spelling has been changed through misunderstanding, transcription error,
mishearing, etc.
• Putrefaction or decomposition of recently living matter. This physical process is
the primary model of the metaphorical meaning of corruption, so advanced states
of corruption in, e.g. a political structure are said to result in their putrefaction
• The act of corrupting or of impairing integrity, virtue, or moral principle; the state
of being corrupted or debased; loss of purity or integrity; depravity; wickedness;
impurity; bribery.

In broad terms, political corruption is when government officials use their governmental
powers for illegitimate private gain. Misuse of government power for other purposes,
like repression of political opponents and general police brutality, is not considered
political corruption. Illegal acts by private persons or corporations not directly involved
with the government is not considered political corruption either. Illegal acts by
officeholders constitute political corruption only if the acts are directly related to their
official duties.

All forms of government are susceptible to political corruption. Forms of corruption vary,
but include bribery, extortion, cronyism, nepotism, patronage, graft, and embezzlement.
While corruption may facilitate criminal enterprise such as drug trafficking, money

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laundering, and trafficking, it is not restricted to these organized crime activities. In some
nations corruption is so common that it is expected when ordinary businesses or citizens
interact with government officials. The end-point of political corruption is a kleptocracy,
literally "rule by thieves".

What constitutes illegal corruption differs depending on the country or jurisdiction.

Certain political funding practices that are legal in one place may be illegal in another. In
some countries, government officials have broad or not well defined powers, and the line
between what is legal and illegal can be difficult to draw.

Bribery around the world is estimated at about $1 trillion (£494bn) and the burden of
corruption falls disproportionately on the bottom billion people living in extreme poverty.

Types of abuse
Bribery

Bribery requires two participants: one to give the bribe, and one to take it. In some
countries the culture of corruption extends to every aspect of public life, making it
extremely difficult for individuals to stay in business without resorting to bribes. Bribes
may be demanded in order for an official to do something he is already paid to do. They
may also be demanded in order to bypass laws and regulations. In some developing
nations up to half of the population have paid bribes during the past 12 months. [3]

Graft

Main article: Graft

While bribery includes an intent to influence or be influenced by another for personal

gain, which is often difficult to prove, graft only requires that the official gains something
of value, not part of his official pay, when doing his work. Large "gifts" qualify as graft,
and most countries have laws against it. (For example, any gift over $200 value made to
the President of the United States is considered to be a gift to the Office of the Presidency
and not to the President himself. The outgoing President must buy it if he wants to take it
with him.) Another example of graft is a politician using his knowledge of zoning to
purchase land which he knows is planned for development, before this is publicly known,
and then selling it at a significant profit. This is comparable to insider trading in business.

Extortion and robbery

Main articles: Extortion and Robbery

While bribes may be demanded in order to do something, payment may also be

demanded by corrupt officials who otherwise threaten to make illegitimate use of state
force in order to inflict harm. This is similar to extortion by organized crime groups.
Illegitimate use of state force can also be used for outright armed robbery. This mostly

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occurs in unstable states which lack proper control of the military and the police. Less
open forms of corruption are preferred in more stable states.

Government officials, especially if involved in illegal activities, are also liable to

extortion, both by senior corrupt officials or other criminals. These develop over time
into complicated networks of corruption, where law enforcement merely serves as a way
to discredit and destroy. The anti-corruption effort is not immune to corruption either:
there are examples of cases where officials of an Anti-Corruption Bureau have extorted
sums from corrupt officials.

Patronage

Main article: Patronage

Patronage refers to favoring supporters, for example with government employment. This
may be legitimate, as when a newly elected government changes the top officials in the
administration in order to effectively implement its policy. It can be seen as corruption if
this means that incompetent persons, as a payment for supporting the regime, are selected
before more able ones. In nondemocracies many government officials are often selected
for loyalty rather than ability. They may be almost exclusively selected from a particular
group (for example, Sunni Arabs in Saddam Hussein's Iraq, the nomenklatura in the
Soviet Union, or the Junkers in Imperial Germany) that support the regime in return for
such favors.

Nepotism and cronyism

Main articles: Nepotism and Cronyism

Favoring relatives (nepotism) or personal friends (cronyism) is a form of illegitimate

private gain. This may be combined with bribery, for example demanding that a business
should employ a relative of an official controlling regulations affecting the business. The
most extreme example is when the entire state is inherited, as in North Korea or Syria.

Nepotism is widely accepted and expected in many cultures.

Embezzlement

Main article: Embezzlement

Embezzlement is outright theft of entrusted funds. It is a misappropriation of property.

Kickbacks

A kickback is an official's share of misappropriated funds allocated from his or her

organization to an organization involved in corrupt bidding. For example, suppose that a
politician is in charge of choosing how to spend some public funds. He can give a
contract to a company that isn't the best bidder, or allocate more than they deserve. In this

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case, the company benefits, and in exchange for betraying the public, the official receives
a kickback payment, which is a portion of the sum the company received. This sum itself
may be all or a portion of the difference between the actual (inflated) payment to the
company and the (lower) market-based price that would have been paid had the bidding
been competitive. Kickbacks are not limited to government officials; any situation in
which people are entrusted to spend funds that do not belong to them are susceptible to
this kind of corruption. Related: Bid rigging, Bidding, Anti-competitive practices

Effects
Effects on politics, administration, and institutions

Corruption poses a serious development challenge. In the political realm, it undermines

democracy and good governance by flouting or even subverting formal processes.
Corruption in elections and in legislative bodies reduces accountability and distorts
representation in policymaking; corruption in the judiciary compromises the rule of law;
and corruption in public administration results in the unfair provision of services. More
generally, corruption erodes the institutional capacity of government as procedures are
disregarded, resources are siphoned off, and public offices are bought and sold. At the
same time, corruption undermines the legitimacy of government and such democratic
values as trust and tolerance.

Economic effects

Corruption also undermines economic development by generating considerable

distortions and inefficiency. In the private sector, corruption increases the cost of
business through the price of illicit payments themselves, the management cost of
negotiating with officials, and the risk of breached agreements or detection. Although
some claim corruption reduces costs by cutting red tape, 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 be bypassed by using bribes.
Where corruption inflates the cost of business, it also distorts the playing field, shielding
firms with connections from competition and thereby sustaining inefficient firms.

Corruption also generates economic distortions in the public sector by diverting public
investment into capital projects where bribes and kickbacks are more plentiful. Officials
may increase the technical complexity of public sector projects to conceal or pave way
for such dealings, thus further distorting investment. Corruption also lowers compliance
with construction, environmental, or other regulations, reduces the quality of government
services and infrastructure, and increases budgetary pressures on government.

Economists argue that one of the factors behind the differing economic development in
Africa and Asia is that in the former, corruption has primarily taken the form of rent

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extraction1 with the resulting financial capital moved overseas rather invested at home
(hence the stereotypical, but sadly often accurate, image of African dictators having
Swiss bank accounts).[2] University of Massachusetts researchers estimated that from
1970 to 1996, capital flight from 30 sub-Saharan countries totaled $187bn, exceeding
those nations' external debts. [3] (The results, expressed in retarded or suppressed
development, have been modeled in theory by economist Mancur Olson.) In the case of
Africa, one of the factors for this behavior was political instability, and the fact that new
governments often confiscated previous government's corruptly-obtained assets. This
encouraged officials to stash their wealth abroad, out of reach of any future expropriation.
In contrast, corrupt administrations in Asia like Suharto's have often taken a cut on
everything (requiring bribes), but otherwise provided more of the conditions for
development, through infrastructure investment, law and order, etc.

Environmental and social effects

Corruption facilitates environmental destruction. Although even the corrupt countries

may formally have legislation to protect the environment, it cannot be enforced if the
officials can be easily bribed. The same applies to social rights such as worker protection,
prevention of child labor and unionization. Violation of these laws and rights enables
corrupt countries to gain an illegitimate economic advantage in the international market.

Ways in which corruption has a particularly damaging impact on

women

There are significant ways in which the effects of corruption are particularly harsh on
women. Consider the position of women in society: since women often face social,
cultural, political and institutional discrimination it is likely that women will face even
more repression in a corruption-ridden society. In other words if access to such
institutions is restricted by gender considerations, corruption compounds this by making
it even more difficult for women to access public goods including services. What follows
is a brief explanation of the ways in which women are affected disproportionately by
corruption. The fight against corruption can improve their opportunities and prospects.

Access to decision-making: Corruption undermines a level playing field for women and
men in decision-making. When political parties can be bought and sold, when officials
are elected through vote-buying and when promotion within the civil service or corporate
sector is related to personal connections rather than merit, there is less chance that
women can increase their representation in Parliament or at management levels within the
public or private sector.

1
In economics, rent seeking occurs when an individual, organization or firm seeks to make money by
manipulating the economic and/or legal environment rather than by trade and production of wealth. The
term comes from the notion of economic rent, but in modern use of the term, rent seeking is more often
associated with government regulation and misuse of governmental authority than with land rents as
defined by David Ricardo.

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Protection and advancement of women's rights: Corruption is often associated with
endemic disregard for human rights and a rise in organised crime, including human
trafficking. Minority groups and less-advantaged groups such as women and girls will
suffer disproportionately in a context where human rights violations are ignored by a
corrupt law enforcement system.

Moreover, a corrupt judiciary will reinforce existing explicit or implicit gender

discrimination.

Women's civil rights are often grossly inequitable with regard to marriage/divorce,
allegations of adultery/rape, child custody, inheritance, property rights and financial
independence. Because women generally lack access to resources, "he" who can pay will
win any case brought to remedy such discrimination by corrupting the prosecutors and/or
judges.

An independent media is one of the most important tools for promoting equal rights
for women as well as for combating corruption. When the state, political parties or
private interests control the media, or when it can be bought, it will be less likely to give
fair coverage of women's issues.

Access to and control over resources: Corruption reduces public revenues, often
resulting in lower levels of spending on basic services such as education, health care,
family benefits and other social services, which predominantly affect women's and
children's welfare (although men, particularly if they are the primary care-givers and
home-managers, are affected too).

Corruption also increases the obstacles for women entrepreneurs, by distorting access to
credit and making it more difficult to obtain the necessary licenses and permits.

Corruption in the water and energy sectors that reduces access to clean water and
affordable household energy will particularly impact poor women, who often bear the
burden of seeking water and fuel for their families. Corruption in the water and energy
sectors that reduces access to clean water and affordable household energy will
particularly impact poor women, who often bear the burden of seeking water and fuel for
their families. For example, see the Gender and Water Alliance which aims to
mainstream gender into water policies, making sure that women are involved in the
planning and carrying out of water policies.

Conditions favorable for corruption

The following conditions are favorable for corruption:

• Information deficits
o Lack of government transparency.
o Lacking freedom of information legislation. The Indian Right to
Information Act 2005 has "already engendered mass movements in the

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 country that is bringing the lethargic, often corrupt bureaucracy to its
knees and changing power equations completely." [4]
o Contempt for or negligence of exercising freedom of speech and freedom
of the press.
o Weak accounting practices, including lack of timely financial
management.
o Lack of measurement of corruption. For example, using regular surveys of
households and businesses in order to quantify the degree of perception of
corruption in different parts of a nation or in different government
institutions may increase awareness of corruption and create pressure to
combat it. This will also enable an evaluation of the officials who are
fighting corruption and the methods used.
o Tax havens which tax their own citizens and companies but not those from
other nations and refuse to disclose information necessary for foreign
taxation. This enables large scale political corruption in the foreign
nations.[4]
• Lacking control over and accountability of the government.
o Democracy absent or dysfunctional. See illiberal democracy.
o Lacking civic society and non-governmental organizations which monitor
the government.
o An individual voter may have a rational ignorance regarding politics,
especially in nationwide elections, since each vote has little weight.
o Weak rule of law.
o Weak legal profession.
o Weak judicial independence.
o Lacking protection of whistleblowers.
o Lack of benchmarking, that is continual detailed evaluation of procedures
and comparison to others who do similar things, in the same government
or others, in particular comparison to those who do the best work. The
Peruvian organization Ciudadanos al Dia has started to measure and
compare transparency, costs, and efficiency in different government
departments in Peru. It annually awards the best practices which has
received widespread media attention. This has created competition among
government agencies in order to improve. [5]
• Opportunities and incentives
o Individual officials routinely handle cash, instead of handling payments by
giro or on a separate cash desk — illegitimate withdrawals from
supervised bank accounts are much more difficult to conceal.
o Public funds are centralized rather than distributed. E.g. if $1,000 is
embezzled from local agency that has $2,000 funds, it easier to notice than
from national agency with $2,000,000 funds. See the principle of
subsidiarity.
o Large, unsupervised public investments.
o Sale of state-owned property and privatization.
o Poorly-paid government officials.
o Government licenses needed to conduct business, e.g. import licenses,
encourage bribing and kickbacks.

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 o Long-time work in the same position may create relationships inside and
outside the government which encourage and help conceal corruption and
favoritism. Rotating government officials to different positions and
geographic areas may help prevent this.
o Costly political campaigns, with expenses exceeding normal sources of
political funding.
o Less interaction with officials reduces the opportunities for corruption. For
example, using the Internet for sending in required information, like
applications and tax forms, and then processing this with automated
computer systems. This may also speed up the processing and reduce
unintentional human errors. See e-Government.
o A windfall from exporting abundant natural resources may encourage
corruption. See the resource curse. [6]
• Social conditions
o Self-interested closed cliques and "old boy networks".
o Family-, and clan-centered social structure, with a tradition of nepotism
being acceptable.
o A gift economy, such as the Chinese guanxi or the Soviet blat system,
emerges in a Communist centrally planned economy.
o In societies where personal integrity is rated as less important than other
characteristics (by contrast, in societies such as 18th and 19th Century
England, 20th Century Japan and post-war western Germany, where
society showed almost obsessive regard for "honor" and personal integrity,
corruption was less frequently seen)[citation needed]
o Lacking literacy and education among the population.

The breeding grounds for corruption lie in a culture where there seems to be very little or almost no
punishment for it and where the rewards for being corrupt seem much greater than the risk of
being caught.

Causative factors directly linked to the possibility of involvement in corrupt practices include:

Low salaries

Corruption is often attributed to the low salaries of civil servants. This differentiates between need driven
(satisfying basic requirements for survival) corruption and greed driven (satisfying desires for status and
comfort that salaries cannot match) corruption.

It may be true that it is more difficult to stay honest, hard-working and trustworthy on a low salary, but it is
also true that most people with low salaries are still able to do so and that many corrupt officials are people
in high, responsible positions, earning good salaries.

In conjunction, corrupt practices flourish in systems where employees have high job security; where the
level of professionalism in the public service is low; and hence officials rather serve their own interests than
perform their duty to serve the public. However, low salaries are not a valid reason for and do not justify
corruption.

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 Culture

A gift culture exists, particularly in Africa, in which it is tradition that a small reward is paid for services rendered. Such a
gratuity or tip becomes part of the cultural environment and in certain countries the payment of such rewards is so embedded
in tradition that any attempt to rein in the practice would be seen as an attack on treasured cultural values. In Africa, this was
traditionally seen as awarding special honours to the Chief and, in this light, it often regarded as acceptable and “normal” for
politicians to accept such rewards. In some countries it is common practice in the commercial arena for business transactions
to be accompanied by the giving of personal gifts or benefits, ranging from the Christmas bottle of whisky to much more
elaborate and extravagant items. In essence, the root of corruption is greed rather than culture, public life requires a standard
of its own; and those entering public office must be made aware of this from the outset.

The absence of rules, regulations, policies and legislation

All organisations, whether public or private sector, must have rules, regulations and policies that guide management and other
employees in terms of acceptable behaviour and conduct within the organisation. Rules, regulations and policies are
instrumental in organising people, steering them towards a common goal and ensuring that everyone is treated fairly and
equally. In order to be effective, such rules and policies must be clearly communicated to all individuals in order to be
understood and applied objectively. Corruption is more likely to flourish in an organisation that does not have a wide range of
rules, regulations or policies that guide employees in their work. Similarly, a country must have clear policies and legislation
that guide the behaviour of all citizens and residents within that country. However, organisations and countries must strike a
reasonable balance in terms of policies and legislation; whilst corruption flourishes in an environment without clear rules and
regulations, similarly, corruption finds fertile in a country that has a numerous laws, rules and regulations that restrict business
and economic activities. Such a climate creates industries’ dependence on individual civil servants to engage in economic
activity; thereby circumventing bureaucratic red tape through corrupt offers.

Range of discretion

No system can exist unless one person or authority is used, to some extent, to make decisions. Such a person is said to have
the power to exercise discretion – the freedom to act within certain limits. Corruption takes place in institutions where public
officials:
• have great authority;
• can exercise discretion with respect to interpretation and application of regulations;
• are not required to be accountable to anyone; and
• are driven by greed.

Therefore, an environment with a higher range of discretion without accountability is more conducive to corruption. In
conjunction, political office is one of the primary means of gaining access to wealth in less developed countries. If corruption
occurs on the top level and the political leadership of the country does not set a good example with respect to honesty,
credibility, transparency, integrity and the persecution of offenders, citizens become disillusioned and offenders are not
deterred from entering into corrupt practices.

The absence of transparency

Where there is no transparency in an organisation, i.e. where tasks and functions are conducted in secret
and are not open to examination by other government officers or the public, the opportunity for corruption
increases. Transparency2 is a prerequisite for democracy in which sovereignty is vested in the people and
the conduct of civil servants must be open to examination. It is therefore vital that citizens in general and
the media (radio, television, newspapers) in particular are guaranteed the right to freedom of speech; the
media can inform citizens of any action by a civil servant that might be corrupt in nature and appropriate
calls for action can be made. A transparent system deters corruption as the conduct of civil servants is
under constant scrutiny.

2
Transparency is introduced as a means of holding public officials accountable and fighting corruption. When
government meetings are open to the press and the public, when budgets and financial statements may be reviewed by
anyone, when laws, rules and decisions are open to discussion, they are seen as transparent and there is less opportunity
for the authorities to abuse the system in their own interest.

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The absence of accountability

In a democracy, public leaders and civil servants must be accountable to the people they serve. Accountability means that
public leaders and officers must provide logical and acceptable explanations for their actions and decisions to the people they
serve. Civil servants and officers in responsible positions must at all times adhere to the principles of transparency and be
accountable to the people they serve. However, accountability is dependent on the enforcement of rules, regulations and
policies, if there is a lack of effective institutional mechanisms civil servants cannot be held accountable and corrupt practices
can flourish.

The absence of a watchdog institution

If there are no internal or external institutions or bodies that investigate cases of corruption or that act on complaints relating to
corruption, employees may take advantage of the fact that the chance of being caught doing something corrupt is remote.
Even if the offender is caught, the consequences would probably be minimal if the system has no watchdog function.

Corruption in less developed countries

Although corruption is a universal phenomenon and exists in all countries, it is a more serious matter in less developed
countries. The conditions of these countries are such that corruption is likely to have different causes and consequences than
in more developed countries. The socio-economic conditions in low income countries are more conducive to the growth of
corruption. Corruption is a symptom of deep-rooted economic and political weaknesses and shortcomings in the legislative
and judicial system of the country. To aggravate the situation, accountability in these countries is generally weak, the chances
of being caught are small and the penalties when caught are light. Non-governmental organizations that could serve as
watchdogs and provide information on corrupt practices are generally not well developed.

(Source: A Namibian Citizen’s Guide to Integrity)

Rich Countries involved in corruption abroad

When asking why poor countries are poor, it is quite common to hear, especially in
wealthier countries that are perceived to have minimal corruption (at least domestically)
that other countries are poor because of corruption. Yet, corruption is not something
limited to third world despots. Rich countries too have been involved in corrupt practices
around the world.

As Professor Robert Neild from Trinity College, Cambridge University writes in Public
Corruption; The Dark Side of Social Evolution (London: Anthem Press, 2002), “Rich
countries and their agencies … commonly have been and are accomplices in corruption
abroad, encouraging it by their actions rather than impeding it….” (p.209). Specific
problems he highlights include:

• The impact of Cold War corruption (supporting dictatorships, destabilizing

democracies, funding opposition, etc);
• Firms from rich countries bribing rulers and officials from developing countries to
gain export contracts, particularly in the arms trade and in construction (even
justifying it by suggesting bribery is “customary” in those countries, so they need
to do it to, in order to compete);
• The “corruption-inducing effects of the purchase, by the rich countries and their
international corporations, of concessions in Third World countries to exploit
natural deposits of oil, copper, gold, diamonds and the like.” Payments made to

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 rulers often violate local (and Western) rules, keeping corrupt rulers in power,
who also embezzle a lot of money away.
• The drug trade. Neild suggests that international law and national laws in rich
countries that prohibit drugs may serve to “produce a scarcity value irresistible to
producers, smugglers and dealers.” Governments and civil society in the third
world are often “undermined, sometimes destroyed” by the violence and
corruption that goes with the drug trade. “This is probably the most important way
in which the policies of rich countries foster corruption and violence. Yet the
effect on the Third World seems scarcely to enter discussion of alternative drug
policies in the rich countries.” Legalizing drugs, a system of taxation and
regulation, comparable to that applied to tobacco and alcohol might do more to
reduce corruption in the world than any other measure rich countries could take,
he suggests.

Rich countries have been used to it, too:

Bribery may be pervasive, but it is difficult to detect. Many Western companies do not
dirty their own hands, but instead pay local agents, who get a 10 per cent or so “success
fee” if a contract goes through and who have access to the necessary “slush funds” to
ensure that it does. Bribery is also increasingly subtle.… Until recently, bribery was seen
as a normal business practice. Many countries including France, Germany and the UK
treated bribes as legitimate business expenses which could be claimed for tax deduction
purposes.

— Dr Susan Hawley, Exporting Corruption; Privatisation, Multinationals and Bribery,

The Corner House, June 2000

A Cold War Legacy: The Curse of Natural Resources;

Inviting corruption
Professor Neild is worth quoting at extensive length on the impacts the Cold War had in
terms of encouraging or exacerbating corruption in the developing countries:

Many Western covert and overt military operation were motivated, in part at least, by the
view, which may have been fearfully exaggerated, that the West’s supplies of raw
materials and oil were threatened by communist intrusion into Third World countries. A
feeling of vulnerability was understandable. The Soviet Union … was largely self-
sufficient …; the West, in need of increasing supplies for its growing industrial
production, depended heavily on imports from Third World countries…. Western
governments used diplomacy plus overt and covert military operations to counter the
Communists. Meanwhile western firms paid rulers to obtain concessions to extract oil
and minerals.

The business of obtaining oil and mineral concessions has aways been conducive to the
use of bribes, omissions, gifts, and favors, and remains so since there are huge “rents”
(i.e. windfall profits) to be shared by the parties to a deal…. Third World governments
rarely use auctions [for concession, which, when done honestly, removes the opportunity

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for buyers to bribe sellers]. They commonly sell concessions by negotiation. For which
there are some good reasons. It is often necessary for the foreign company that buys a
concession to build infrastructure, such as ports, pipelines, roads and dormitory towns for
their staff; to make this worthwhile, a whole oil field or major mineral deposit has to be
given to one foreign company, rather than split between many competitors; and that one
company, which will become the source of a significant, perhaps dominant, part of the
nation’s revenue, will acquire substantial economic power vis-à-vis the government.
Hence strategic and diplomatic consideration enter the calculation: the government will
want to give the concession to a company backed by a government which it believes will
be helpful to it in its international relations—and in supplying it with arms and
mercenaries. But …. there is [also] the prospect of bribes. Those who run a government
that has a concession to sell will know that negotiation creates a strong incentive to the
potential buyers to offer them bribes: they will know this from the point of view of the
buyers, a sum that will only add a small percentage to, say, a billion dollar deal, will be
worth paying in order to win the concession. Once negotiation is adopted as the means of
allocating concessions, the dominant incentive is for bidders to engage competitively in
the bribery of local rulers and fixers.

— Robert Neild, Public Corruption; The Dark Side of Social Evolution, (London:
Anthem Press, 2002), pp. 136-137 [Emphasis added]

But Neild feels that this same attitude has affected rich countries’ domestic political
behavior, too. Of particular concern to Neild in this is

the apparent tendency for bribery, which is intense in the business of seeking resource
concession and selling arms, to become a secret habit of western firms and politicians
that infects their domestic political behavior. Of this there has been considerable evidence
in scandals that have occurred recently in Britain, France and Germany…. Le Monde
published an outspoken editorial commenting on the [French company, Elf Aquitaine,
corruption] affair:

For too long French policy in Africa has been neither moral nor effective.

… It would be wrong to deny that corruption is indispensable in the obtaining of drilling

concession, though that does not mean that one should not try to stop it. M. Tarallo [a
senior Elf Manager] is unfortunately right when he says that all petrol companies use it…
But the sins of others do not absolve Elf. Added to which … Elf has used its money to
keep in power dictators whose principle aim has been not the development of their
country but their personal enrichment. In exchange, Paris could count on their support in
its diplomatic battles and could offer captive markets to French firms…

This “neo-colonialism” was put in place during the presidency of General de Gaulle and
has been maintained by subsequent governments regardless of party…

Looked at today the picture is not glorious. A former colonial power has taught
corruption to its African clients—who were willing pupils—and there is nothing to
persuade us that they have not rewarded their friends in Paris…

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… In one case at least, lack of natural resources has apparently been an incentive to
anticorruption policies: the tough ruler of Singapore, Lee Kuan Yew, is reported to have
said that he came down hard on the corrupt because his tiny country with no natural
resources has to rely on its good name to remain a center of banking and technology.

— Robert Neild, Public Corruption; The Dark Side of Social Evolution, (London:
Anthem Press, 2002), p. 138 [Emphasis added]

Globalization, Multinational Corporations, and

Corruption
Corruption scandals that sometimes make headline news in Western media can often be
worse in developing countries. This is especially the case (as the previous link argues)
when it is multinational companies going into poorer countries to do business. The
international business environment, encouraged by a form of globalization that is heavily
influenced by the wealthier and more powerful countries in the world makes it easier for
multinationals to make profit and even for a few countries to benefit. However, some
policies behind globalization appear to encourage and exacerbate corruption as
accountability of governments and companies have been reduced along the way. For
example,

For multinationals, bribery enables companies to gain contracts (particularly for public
works and military equipment) or concessions which they would not otherwise have won,
or to do so on more favorable terms. Every year, Western businesses pay huge amounts
of money in bribes to win friends, influence and contracts. These bribes are
conservatively estimated to run to US$80 billion a year—roughly the amount that the UN
believes is needed to eradicate global poverty.

— Dr Susan Hawley, Exporting Corruption; Privatization, Multinationals and Bribery,

The Corner House, June 2000

Dr Hawley also lists a number of impacts that multinationals’ corrupt practices have on
the “South” (another term for Third World, or developing countries), including:

• They undermine development and exacerbate inequality and poverty.

• They disadvantage smaller domestic firms.
• They transfer money that could be put towards poverty eradication into the hands
of the rich.
• They distort decision-making in favor of projects that benefit the few rather than
the many.
• They also
o Increase debt;
o Benefit the company, not the country;
o Bypass local democratic processes;
o Damage the environment;
o Circumvent legislation; and

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 o Promote weapons sales.

(See the previous report for detailed explanation on all these aspects.)

IMF and World Bank Policies that Encourage

Corruption
At a deeper level are the policies that form the backbone to globalization. These policies
are often prescribed by international institutions such as the World Bank and IMF. For
years, they have received sharp criticism for exacerbating poverty through policies such
as Structural Adjustment, rapid deregulation and opening barriers to trade before poorer
countries are economic ready to do so. This has also created situations ripe for corruption
to flourish:

As Western governments and the World Bank and IMF shout ever more loudly about
corruption, their own policies are making it worse in both North and South. Particularly
at fault are deregulation, privatization, and structural adjustment policies requiring civil
service reform and economic liberalization. In 1997, the World Bank asserted that:

any reform that increases the competitiveness of the economy will reduce incentives for
corrupt behavior. Thus policies that lower controls on foreign trade, remove entry barriers
to private industry, and privatize state firms in a way that ensure competition will all
support the fight.

The Bank has so far shown no signs of taking back this view. It continues to claim that
corruption can be battled through deregulation of the economy; public sector reform in
areas such as customs, tax administration and civil service; strengthening of anti-
corruption and audit bodies; and decentralization.

Yet the empirical evidence, much of it from the World Bank itself, suggests that, far from
reducing corruption, such policies, and the manner in which they have been implemented,
have in some circumstances increased it.

— Dr Susan Hawley, Exporting Corruption; Privatization, Multinationals and Bribery,

The Corner House, June 2000

Jubilee Research (formerly the prominent Jubilee 2000 debt relief campaign
organization) has similar criticisms, and is also worth quoting at length:

Rich country politicians and bank officials argue that because dictators like Marcos,
Suharto, and Mobutu were kept in power with western arms and were given loans to
squander on ill-judged and repressive schemes, that the people of those countries—who
often fought valiantly against those dictators—cannot be trusted not to waste the money
released by debt cancellation. This may seem confusing to people not familiar with the
logic of the IMF and World Bank. In summary:

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 • Creditors colluded with, and gave loans to dictators they knew were corrupt and
who would squander the money.
• Creditors gave military and political aid to those dictators—knowing arms might
be used to suppress popular opposition
• Therefore, successor democratic governments and their supporters, who may have
been victims of corruption and oppression, cannot be trusted.

To many people in the South, this seems irrational and illogical—the logic of blaming the
victim. It is the logic of power rather than of integrity, and is used to benefit the rich
rather than the poor in developing countries.

A similar logic argues that if the World Bank and government export credit agencies
promoted inappropriate and unprofitable projects, then southern governments proved
their inability to control money because they accepted the ill-advised projects in the first
place. Thus, if money is released by debt cancellation, it must be controlled by agencies
which promoted those failed projects.

This is the logic that says if people were stupid enough to believe cigarette advertising,
then they are too stupid to take care of themselves and the “reformed” cigarette
companies should be put in charge of their health care.

The same institutions who made the corrupt loans to Zaire and lent for projects in Africa
that failed repeatedly are still in charge, but their role has been enhanced because of their
success in pushing loans. Can we trust these institutions to suddenly only lend wisely; to
not give loans when the money might be wasted?

Preventing new wasted loans and new debt crises, and ensuring that there is not another
debt crisis, means that the people who pushed the loans and caused this crisis cannot be
left in charge.

The creditors or loan pushers cannot be left in charge, no matter how heartfelt their
protestations that they have changed. Pushers and addicts need to work together, to bring
to an end the entire reckless and corrupt lending and borrowing habit.

— Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to
addictive lending and borrowing—and its corrupting side-effects, Jubilee Research,
March 2000

And in terms of how lack of transparency by the international institutions contributes to

so much corruption structured into the system, Hanlon and Pettifor continue in the same
report as cited above:

Structural adjustment programs cover most of a country’s economic governance.

… The most striking aspect of IMF/World Bank conditionality [for aid, debt relief, etc] is
that the civil servants of these institutions, the staff members, have virtual dictatorial
powers to impose their whims on recipient countries. This comes about because poor
countries must have IMF and World Bank programs, but staff can decline to submit

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programs to the boards of those institutions until the poor country accepts conditions
demanded by IMF civil servants.

There is much talk of transparency and participation, but the crunch comes in final
negotiations between ministers and World Bank and IMF civil servants The country
manager can say to the Prime Minister, “unless you accept condition X, I will not submit
this program to the board”. No agreed program means a sudden halt to essential aid and
no debt relief, so few ministers are prepared to hold out. Instead Prime Ministers and
presidents bow to the diktat of foreign civil servants. Joseph Stiglitz also notes that
“reforms often bring advantages to some groups while disadvantaging others,” and one of
the problems with policies agreed in secret is that a governing elite may accept an
imposed policy which does not harm the elite but harms others. An example is the
elimination of food subsidies.

— Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to
addictive lending and borrowing—and its corrupting side-effects, Jubilee Research,
March 2000

As further detailed by Hanlon and Pettifor, Christian Aid partners (a coalition of

development organizations), argued that top-down “conditionality has undermined
democracy by making elected governments accountable to Washington-based institutions
instead of to their own people.” The potential for unaccountability and corruption
therefore increases as well.

Corruption everywhere; rich and poor countries,

international institutions
It goes without saying, almost, that corruption is everywhere. Corruption in poor
countries is well commented on (sometimes used dismissively to explain away problems
caused by other issues, too). It would be futile to provide examples here (see also the
sources of information at the end of this document for more on this).

Rich countries, also suffer from corruption. Examples are also numerous and beyond the
scope of this page to list them here. However, a few recent examples are worth
mentioning because they are varied on the type of corruption involved, and are very
recent, implying this is a massive problem in rich countries as well as poor.

The first example is the US government, accused of outsourcing many contracts without
an open bid process. Jim Hightower notes that “An analysis by the Times found that more
than half of their outsourcing contracts are not open to competition. In essence, the
Bushites choose the company and award the money without getting other bids. Prior to
Bush, only 21% of federal contracts were awarded on a no-bid basis.”

Another example is Italy, where former Italian Prime Minister Silvio Berlusconi and
some of his close associates were held on trial for various crimes and corruption cases
(though Berlusconi himself has not, to date, been found guilty of any charges). Many key

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teams in the massive Italian soccer league, Serie A were also found to be involved in a
massive corruption ring.

In the United Kingdom, the arms manufacturer, BAE was being investigated for bribing
Saudi officials to buy fighter planes, but the government intervened in the investigation
citing national interests. The Guardian also reported that BAE gave a Saudi prince a £75
airliner ($150m approx) as part of a British arms deal, with the arms firm paying the
expenses of flying it. This seemingly large figure is small compared to the overall deal,
but very enticing for the deal makers, and it is easy to see how corruption is so possible
when large sums are involved.

International institutions, such as the United Nations and World Bank have also recently
come under criticism for corruption, ironically while presenting themselves in the
forefront fighting against corruption.

The recent example with the UN has been the oil for food scandal, where the headlines
were about the corruption in the UN. In reality, the figures of $21 billion or so of illicit
funds blamed on the UN were exaggerations; it was $2 billion; it was the UN Security
Council (primarily US and UK) responsible for much of the monitoring; US kickbacks
for corrupt oil sales were higher, for example. (This is discussed in more detail on this
site’s Iraq sanctions, oil for food scandal section.)

At the World Bank, headlines were made when its recent president, Paul Wolfowitz, was
forced to resign after it was revealed he had moved his girlfriend to a new government
post with an extremely high salary without review by its ethics committee.

Paul Wolfowitz’s appointment was also controversial, due to his influential role in
architecting the US invasion of Iraq. A former member of staff at the World Bank also
noted concerns of cronyism related to Wolfowitz’s appointment way before the scandal
that forced him to resign.

The US nominee for the next president is the former US Trade Representative and
currently an executive at Goldman Sachs, Robert Zoellick. His nomination is also coming
under criticism. Bush supports it, saying Zoellick “is the right man to succeed Paul in this
vital work.” Former World Bank chief economist, and Nobel Prize winner for economics,
Joseph Stiglitz feels that instead of a political appointee, it would be better to get an
economist who understands development.

As also reported by the BBC, Paul Zeitz, executive director of the Global AIDS Alliance,
said that he thought Mr Zoellick was a terrible choice because “Zoellick has no
significant experience in economic development in poor countries,” and that “he has been
a close friend to the brand-name pharmaceutical industry, and the bilateral trade
agreements he has negotiated [for the US] effectively block access to generic medication
for millions of people.”

While the US typically gets its preferred nomination to head the World Bank, Europe has
typically got its preferred person to head the IMF. Critics have long argued that this lacks

17
transparency and is not democratic. While not illegal as such, it does feel like a form of
corruption.

PERSPECTIVES OF CORRUPTION CAUSES

The various causes of corruption can be viewed from two perspectives:

Individual characteristics perspective

• View corruption as a result of greed or the inability to withstand temptation.

• Considered a main motivating factor of corruption, greed is a strong motivator for human
behaviour.

• This explanation provides insight into why some people become involved in corruption, but
does not satisfactorily explain the extent of corruption in society.

Structural influences perspective

• Analyses the structural influences in society, including various political, social and cultural
needs that motivate individuals to engage in corrupt practices.

• Systemic corruption breeds in a culture where the rewards for being corrupt are perceived as far
greater than the risks of being caught.

• Provides a broader-level explanation than for the extent of corruption that the individual
characteristics perspective.

Size of public sector

It is a controversial issue whether the size of the public sector per se results in corruption.
Extensive and diverse public spending is, in itself, inherently at risk of cronyism,
kickbacks and embezzlement. Complicated regulations and arbitrary, unsupervised
official conduct exacerbate the problem. This is one argument for privatization and
deregulation. Opponents of privatization see the argument as ideological. The argument
that corruption necessarily follows from the opportunity is weakened by the existence of
countries with low to non-existent corruption but large public sectors, like the Nordic
countries. However, these countries score high on the Ease of Doing Business Index, due
to good and often simple regulations, and have rule of law firmly established. Therefore,
due to their lack of corruption in the first place, they can run large public sectors without
inducing political corruption.

Privatization, as in the sale of government-owned property, is particularly at the risk of

cronyism. Privatizations in Russia and Latin America were accompanied by large scale
corruption during the sale of the state owned companies. Those with political connections
unfairly gained large wealth, which has discredited privatization in these regions. While
media have reported widely the grand corruption that accompanied the sales, studies have
argued that in addition to increased operating efficiency, daily petty corruption is, or
would be, larger without privatization, and that corruption is more prevalent in non-
privatized sectors. Furthermore, there is evidence to suggest that extralegal and unofficial
activities are more prevalent in countries that privatized less.[5]

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In the European Union, the principle of subsidiarity is applied: a government service
should be provided by the lowest, most local authority that can competently provide it.
An effect is that distribution of funds into multiple instances discourages embezzlement,
because even small sums missing will be noticed. In contrast, in a centralized authority,
even minute proportions of public funds can be large sums of money

Measuring corruption
Measuring corruption - in the statistical sense - is naturally not a straight-forward matter,
since the participants are generally not forthcoming about it. Transparency International,
a leading anti-corruption NGO, provides three measures, updated annually: a Corruption
Perceptions Index (based on experts' opinions of how corrupt different countries are); a
Global Corruption Barometer (based on a survey of general public attitudes toward and
experience of corruption); and a Bribe Payers Survey, looking at the willingness of
foreign firms to pay bribes. The World Bank collects a range of data on corruption,
including a set of Governance Indicators.

The ten countries perceived to be least corrupt, according to the 2007 Corruption
Perceptions Index, are Denmark, Finland, New Zealand, Singapore, Sweden, Iceland,
The Netherlands, Switzerland, Canada, and Norway.

According to the same survey, the nine countries perceived to be most corrupt are
Somalia, Myanmar, Iraq, Haiti, Uzbekistan, Tonga, Sudan, Chad, and Afghanistan.

In the USA, Louisiana, Mississippi, Kentucky, Alabama, and Ohio are the top five most
corrupt states, according to a 2007 study by Corporate Crime Reporter (based on U.S.
Department of Justice data on public convictions).[8]

Tackling corruption
What can be done to tackle this problem?

The above-cited report by Hanlon and Pettifor also highlights a broader way to try and
tackle corruption by attempting to provide a more just, democratic and transparent
process in terms of relations between donor nations and their creditors:

Campaigners from around the world, but particularly the South, have called for a more
just, independent, accountable and transparent process for managing relations between
sovereign debtors and their public and private creditors.

An independent process would have five goals:

• to restore some justice to a system in which international creditors play the role of
plaintiff, judge and jury, in their own court of international finance.
• to introduce discipline into sovereign lending and borrowing arrangements—and
thereby prevent future crises.

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 • to counter corruption in borrowing and lending, by introducing accountability
through a free press and greater transparency to civil society in both the creditor
and debtor nations.
• to strengthen local democratic institutions, by empowering them to challenge and
influence elites.
• to encourage greater understanding and economic literacy among citizens, and
thereby empower them to question, challenge and hold their elites to account.

— Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to
addictive lending and borrowing—and its corrupting side-effects, Jubilee Research,
March 2000

The Bretton Woods Project organization notes that the World Bank, under pressure of
late, has suspended a number of loans due to concerns of corruption. These include loans
to Chad, Kenya, Congo, India, Bangladesh, Uzbekistan, Yemen, and Argentina. The
Bank has also started internal investigations of Bank corruption. However, “despite high-
profile moves by president Paul Wolfowitz, the root causes of corruption—underpaid
civil servants, an acceptance of bribery by big business, and dirty money—remain largely
unaddressed.”

The Bretton Woods Project adds that the “normalization of petty corruption in developing
countries has in part been driven by”

• IFI conditions;
• The aid industry for “overpaying consultants” and turning a blind eye to
corruption in some regimes; and
• The “World Bank’s ‘pressure to lend’ culture where staff are rewarded for the
volume of the portfolio they manage;”
• The World Bank’s slow pace in investigating and disbarring companies found
guilty of corrupt practices such as bribery, fraud or malpractice;
• Failing to increase transparency of some of its own procedures;
• The IFI’s “central part of an international financial system which has both
actively and tacitly supported the global proliferation of dirty money flows”
including, for example, the financing of various despotic rulers that have siphoned
off a lot of money to personal offshore accounts.

To help address these problems, the Bretton Woods Project suggests a few steps:

• Greater transparency of World Bank processes, allowing greater visibility for

elected officials and civil society in recipient countries;
• Strengthening internal mechanisms within the Bank itself, to monitor integrity of
Bank functions, and allow truly independent audits of Bank operations;
• Minimum standards in governance, transparency and human rights that must be
fulfilled before approving oil, gas and mining projects in institutionally weak
countries.
• Not always tying loans with economic policy conditions in such a way that some
governments surrender their policy-making space.

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During the 2002 World Summit on Sustainable Development, the BBC broadcast a mini
debate on globalization, poverty, and related issues, and had a panel of around 30 experts,
from both the developing and rich countries. One person on that panel was Vandana
Shiva, a vocal critic of the current form of globalization and its impact on the
environment and people in the third world. She was asked why people should listen to
concerns from the third world when they cannot sort out the rampant corruption first. Her
answer was simple: rich countries need to stop dictating policies that encourage
corruption in the first place.

Like Shiva, Professor Neild feels that the solution is philosophically simple. However, as
Neild acknowledges, in reality it is far harder to do, due to the power interests involved:

It is hard to see how the international economic agencies and their member governments
can introduce incentives that would cause corrupt rulers to [attack corruption]… Not only
are the rich countries and their agencies in this respect impotent, they commonly have
been and are accomplices in corruption abroad, encouraging it by their action rather than
impeding it.

… It is hard to see any solution other than transparency and criticism. It would take an
unprecedented degree of united dedication to the checking of corruption for the
international community to agree that the oil and mining companies of the world should
boycott corrupt regimes, somehow defined, let alone manage to enforce an agreement.

— Robert Neild, Public Corruption; The Dark Side of Social Evolution, (London:
Anthem Press, 2002), pp. 208-210, [Emphasis added]

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Fighting corruption in the developing countries
Irène Hors
Development Centre
Published: July 2000

The fight against corruption is not the monopoly of the industrialised countries. Nor can
recipes that have worked in OECD countries necessarily be applied to developing ones.
Of the 134 countries that attended the 9 th International Anti-Corruption Conference
organised by Transparency International in Durban last October, over a hundred were
developing countries. More and more of these countries are expressing their resolve to
combat corruption, echoing international initiatives, such as the OECD Convention.

Despite the real efforts made, there has been little concrete progress to date.

In most developing countries today, corruption is widespread and part of everyday life.
Society has learned to live with it, even considering it, fatalistically, as an integral part of
their culture. Not only are public or official decisions – for instance, on the award of
government contracts or the amount of tax due – bought and sold, but very often access
to a public service or the exercise of a right, such as obtaining civil documents, also has
to be paid for.

Several mechanisms help to spread corruption and make it normal practice in these
countries. Civil servants who refuse to toe the line are removed from office; similarly,
businessmen who oppose it are penalised vis-à-vis their competitors. Furthermore, an
image of the state has grown up over the years according to which the civil service, far
from being a body that exists to implement the rights of citizens – rights that mirror their
duties – is first and foremost perceived as the least risky way of getting rich quickly. All
of which helps to make corruption seem normal.

In practice, it is the environment in which public servants and private actors operate that
causes corruption. Public administration in developing countries is often bureaucratic and
inefficient. And a large number of complex, restrictive regulations coupled with
inadequate controls are characteristic of developing countries that corruption helps to get
around.

But to understand corruption, institutional analysis is not enough. A political and

economic analysis is important too. Whether it be in Benin, Bolivia, Morocco, Pakistan
or the Philippines – five countries examined in a study by the OECD Development
Centre and the UN Development Programme – corruption is closely linked to the type of
government involved.

The link between political and economic power can be direct. There is patrimonialism, as
in Morocco, where access to political power ensures access to economic privileges. The
link can be indirect too, as in the Philippines, where political power, such as a privileged
position in a patronage-based system, can be bought and sold. In short, the process of
allocating political and administrative posts – particularly those with powers of decision
over the export of natural resources or import licences – is influenced by the gains that

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can be made from them. And the political foundations are cemented as these exchanges
of privileges are reciprocated by political support or loyalty.

Feeding underdevelopment

Another feature common to the countries studied is their underdevelopment, which is

conducive to corruption. In fact, underdevelopment encourages corruption. How is this?
First of all, low wages in the civil service encourage petty corruption, and the imbalance
between the supply of, and demand for, public services likewise creates opportunities for
corruption. Also, individuals tend to invest in a career in the public service, given the
shortage of opportunities in the private sector, thus increasing the likelihood of their
involvement in corrupt practices. Another reason is that the low level of education found
in underdeveloped countries maintains citizens in a state of ignorance of their rights,
barring them from participating in political life.

Institutional analysis of corruption indicates where the remedies lie. Greater transparency,
accountability and merit-based human resource management in public administration are
principles which, if implemented, make it possible to curb corruption. Simplification of
state intervention in economic activity also helps. A study of the customs administration
in Senegal found, using econometric tests, that a reduction in import taxes, simplification
of their structure, implementation of reforms reducing the discretionary powers of
customs officials and computerisation of procedures helped to reduce the level of fraud
by 85% between 1990 and 1995.

But identifying the direction that reforms should take is only part of the task. The main
difficulty lies in implementing them. This requires a strategy that really is operational.
Two kinds of obstacles are usually encountered. The first is economic. While
underdevelopment does not inevitably generate corruption, underdeveloped countries do
not have the same means as more advanced ones to escape it. It is difficult to replicate the
strategy adopted in Hong Kong, for instance, which involved the creation of an
investigative agency with a large staff and plentiful funds (see box). The fight against
corruption must therefore be based on the development process itself.

The second kind of obstacle is political. Many politicians owe their careers and status to
corruption and few of them, if any, will take a stand against it, either for fear of upsetting
their own careers or the political status quo generally.

Civil society and the media can help by denouncing corruption and putting pressure on
the government. But the real impediments to the fight against corruption are as much the
interests of the politico-administrative apparatus as the fatalism and ignorance of the
victims, maintained by a culture of fear nurtured by those who benefit from corruption.
But before one can act, it is necessary to be informed. That is why research into the
incidence of corruption and its effects is so important. Only on that basis can action by
civil society and aid agencies be guided.

The private sector can also make an important contribution to the fight against corruption,
by policing its own codes of conduct and sticking to high standards of governance.
International and regional organisations can also help, as can bilateral aid agencies, via

23
programmes to strengthen institutional capacity, and of course by ensuring the
transparency of the projects they support.

One thing is sure: the problem of corruption in the developing countries cannot be solved
simply by applying anti-corruption structures that work in OECD countries. The
experience the latter countries have acquired in terms of legislation, public procurement
codes and control procedures, for example, is valuable, but it is just a technical element in
a much more complex process of change. A reduction in corruption depends on economic
development. It is thus for each country concerned to draw up its own strategy, by which
it can then lead to a virtuous circle of development and good governance.

Bibliography

ﾏ Stasavage, David and Daubrée, “Determinants of Customs Fraud and Corruption:

Evidence from Two African Countries”, Technical Paper No 138,OECD Development
Centre, August 1998.

ﾏ Hors, Irène, Fighting Corruption in Developing Countries and Emerging Economies:

the Role of the Private Sector, study by the OECD Development Centre, to be published.

©OECD Observer No 220, April 2000

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