Tuesday, May 4, 2010

Business corruption

Everyone wants less corruption -- or more opportunities to participate in it. The Economist is now reporting that corruption has many hidden costs and is therefore worth stamping out even from the bribers perspective.
Corruption hurts because it damages trust, a very valuable economic asset indeed. The article goes on to explain that contrary to expectation, it also discourages officials from acting efficiently, as instead of doing their proper jobs, they now act primarily to hit up people for money. Repeatedly. Paying one bribe encourages the demand of additional bribes in the future. In addition, it psychologically damages both parties -- the briber feeling morally filthy, the bribee becoming more entitled and obnoxious.
The article also goes on to say that even in countries with a lot of corruption, companies can prosper without paying bribes. It even gives a list of them.
In India, a country notorious for having corrupt officials, an NGO produced a zero-rupee banknote to remind officials that asking for bribes is unacceptable. One "pays" bribes with a note that explicitly proclaims itself to have no value, embarrassing the corrupt official. So far, it's working. When the official himself (or herself, but generally corrupt officials show a tendency to be male), doesn't take the hint, it becomes quite blatant to his supervisors what he's trying to do, and they order him to do the right thing. Or else. I salute the clever Indian anti-corruption NGO's solution, and wish to see it exported to other countries. Perhaps even my own -- I have yet to have a bribe demanded from me, but I'd want to be ready, just in case.


TwoYaks said...

Many places, Bribes are considered the norm. I know a guy who went to Russia, and one of the conditions for them acknowledging his exit visa (you need a visa to get out of the country) was the official getting an iPhone.

themadengineer said...

I heard that Russia was bad corruption wise but holy fucking shit. An iPhone? "Buy me an iPhone so you can leave?"

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