talk about corruption, consequences and reform.
parking violations by UN diplomats: UN diplomats in NYC do not pay parking tickets (until 2002) since a 90% drop. still, diplomats from Scandinavian countries have close to zero fines, other countries with high corruption have many tickets.
Scandinavian countries have a lot of things that work. inequality, social services, cities with bikes.
the tension between power and money will exist forever. what is legitimate is relative. lobbyists, create almost all the problems of corruption, but just under a legal pretext. think of the tobacco lobby or the farmer’s lobby. the movie borat comes to mind regarding how relative values are.
corruption is the tension between power and money and actually tries to replace one person, one vote with one dollar, one vote
‘bribe is a way of getting personal’ creating a personal relationship.
singapore changed in a big way, buy paying public officials market rates. enforcement is crucial
transparency – aggregating costs and telling the public in a quantified way how much it costs may help.
size of government and likeliness of corruption? no clear evidence. some of the bigger governments (Scandinavia) are not corrupt but there is a cause and effect, the state functions well, is big, and is not corrupt
corruption: misuse of public power for private gain. could be included in private companies for self gain
CPI: corruption perception index. high number (1-10) means good = low corruption. poorer countries tend to be more corrupt.
incentives for bribery:
- government gives access to scarce resources. e.g. license to run a casino. seek monopoly rent to be shared. only one electric company to be privatized. anything with a cap on it – admissions to universities, or anything requires a license.
- better quality service. pay to get ahead of the queue
- obtain a benefit to all qualified
is there a problem? inefficient, poor pricing mechanism, vicious cycle to create red tape. so better to privatize it or price it officially. consequence include lower state legitimacy, higher cost of doing business.
result: underinvestment in education and growth, over investment in infrastructure
Scandinavian countries are leaders. 2002 -2007 israel dropped from #20 to # 30 in the world. still a very good place.
strength of mafia has influence with positive corrlation
post conflict is great – destruction , need to build, lots of money coming in quickly with weak domestic institutions. iraq add natural resources. how you integrate former fighters is crucial.
shift in public attitude towards corruption?
- could think of shift in opportunities. usually economic, occurs often
- change in values. good people can not be suckers. slow but does happen once in a while. e.g. good government movement in the US in 19th century lead by jefferson