Corruption and Economic Development

 CORRUPTION AND ECONOMIC DEVELOPMENT

Economic development is a broader concept that it not only includes quantitave changes like increase in national output or per capita output in the economy in fact it also includes certain qualitative or social changes like increase in literacy rate, improvement in health care facilities, environment conservation etc. Economists like Colin Clark and Kindleberger perceived economic development in terms of economic welfare or in terms of actual availability of basic necessities to the people of a country. 

Under developed economy remain backward because in that economy there is low level of economic development as compared to developed economies. In such countries there is high inequality of income and wealth that a small community is holding handsome amount with them and rest having enough money barely to survive. According to Prof. Todaro "The gap between rich and poor is generally greater in less developed nations than in a developed nations."

It is the corruption that through the immoral behaviour of one uses the benefits at higher cost and one abuses the power for the personal gain and the major cause behind it is only the greed for money. Due to such practices one is motivated to do tax evasion to increase the income. An unemployed person tries to convince higher authority at handsome amount of money and benefitted the facilities. In this way development of an economy is not possible. There need to be proper targeting of social programs for the needy that the gap between the rich & poor shall be narrowed.

There is scarcity of capital in underdeveloped economy as such economies are lacking behind in terms of factories, machineries, public utilities or capital goods and as the majority of population is not capable to generate savings for capital formation. It is due to corruption that only few are capable to generate savings which is meare for economic development. In economies which are dominant in agriculture the farmers have to face corruption everywhere like if they want to increase their electricity load or have to seek permission from the government offices, for irrigation facilities from the near by canal is very difficult to seek the permission it includes bribery at every step even while selling the crop at grain market there is corruption that farmer is given lower rate but his crop is sold at higher rate later on. 

Economic development shall only be possible when there is social welfare in the economy that if people are well educated then the evils like corruption shall be easily eliminated that the literate strength of an economy would be involved in healthy practices towards the economic development.

Whenever there is seen a road construction to be done in the city for the better services but it is not possible without corruption and involvement of third party in this makes the situation worse that though a large amount of money is given for development of a city but only one - fourth will be utilised for the betterment & rest goes to the secret chambers of corruption amd as a result a poor quality of work being done at lower rate and development of an economy remain backward.

There is underutilisation of resources. According to Meir and Baldwin---

''Generally the poor counties possess resources, but the resources are unutilised, underutilised or misutilized'' for eg. in India there is no full usage of agricultural land, water resources and minerals and the reason behind their lack of proper usage is the corruption one tries to make more money and the developmental work remain backward. A study was conducted by Transparency International in 2005 which recorded that 62% people of India had paid a bribe to a public official to get their job done earliest. Even to sign a file people gave bribe and official will sign accordingly.

 For the economic development there is required to use the natural resources wisely, technical progress is required. Prof. Schumpeter considers innovations as the essence of entrepreneurial activity. For the economic development there should be political transparency as most of the bribery cases take place among the official even to overcome other sources of corruption in the economy. There should be press freedom and whistle blowers need to be protected.

Prof. Gunnar Myrdal said---"Freedom from corruption is so very essential for economic development of the less developed countries." The government should ensure that the schemes introduced are benefitting the needy or not so that to overcome the powers of corrupt party.

In this way we shall say that a corruption is only a negative part in the way towards the economic development. Hence economic development shall only be done when each resource is fully utilised. Prof. Richard Gill has rightly remarked that economic development are is not a mechanical process. It is not only a summation of various elements. It is indeed a human effort. In this way economic development is very much influenced by the aspiration of the people for growth of an economy. Social change is required in the economy like caste system, joint family system and laws of inheritance leaves a powerful impact on economic development. At last the corruption is the seed sown in an economy makes the economic development almost negligible as it puts an adverse effect on every sector.

******** It is my own unpublished work ********