Essay on Corruption, Its Causes, and Effects

Causes of corruption: essay introduction, causes of corruption, effects of corruption, conclusion: what are the causes and effects of corruption.


Transparency International defines corruption as an act that abuses the entrusted power for private gain. This means that it violates the rights of individuals that have bestowed power, authority, and legitimacy. Corruption varies in degree and nature depending on the level of its occurrence, people involved, and circumstances that motivate individuals to be corrupt. Modernization has transformed corruption, and people adopt new and complicated ways of concealing their fraudulent activities. This paper presents the causes and effects of corruption in the public and private sector.

Politics is an effective way of ensuring power and resources are shared equally among all individuals from different backgrounds within a specified jurisdiction. However, people have used political activities and offices to advance their gains and neglect the need to be accountable and responsible to the public. The emergence of political elites has created room for corruption to flourish in public and private offices because people no longer respect the need to develop national programs that will benefit citizens. They have diverted the resources of the public to achieve their gains without considering the impacts of their actions on other citizens. Politics has allowed corrupt officers to win elections and take powerful positions in government. Therefore, citizens continue to suffer because their interests are not addressed by those they expected would alleviate their problems.

Also, the existence of artificial scarcity of resources has pushed people to look for cheap ways of getting what they need. For instance, the scarcity of employment and investment opportunities has led to stiff competition for the limited available resources. Therefore, people use unorthodox ways to persuade those in charge of approving projects to allow them to continue with their investment projects. People with malevolent intentions continue to destroy the economy of their nations as they create false impressions of the scarcity of resources. The existence of unhealthy competitions among businesses forces some of them to use unethical ways to persuade their clients to buy their products. Government officials in charge of quality standards are usually bribed to cover the activities of such investors, and this promotes corruption in businesses. This violates the rights of citizens to access quality products and services.

Thirdly, the ethical qualities of people in authority have decreased, and their value system deteriorated due to lack of strong moral teachings and responsibilities. People no longer have respect for the old ideals of moral and honest service delivery procedures, and society has become a haven for individuals that disregard human dignity. It is necessary to explain that modernity has clouded the need to respect the positions and individuals placed to serve others. People have little respect for morals that guide service delivery and ensure others benefit from their services. Therefore, corruption has been fuelled by poor moral values and lack of respect for human life.

The present generation is full of corrupt activities because people fail to condemn them. There are no strong civil societies to rebuke and oppose corrupt leaders, and this promotes the flourishing of this behavior in generations. The American public forum is dominated by debates on gay marriages, foreign policies, and inflated health bills, but nobody seems to pay attention to the escalating cases of corruption in the public and private sectors. The younger generations do not see the need to fight corruption because their predecessors support and cultivate it through modern systems and activities.

Lastly, widespread poverty and illiteracy have contributed to endemic corruption in modern societies. There are efforts to educate people, especially the rural folks, to ensure they know their rights and freedoms to reduce corruption in their societies. However, these efforts seem to bear no fruits because poverty drives them to seek cheap and quick ways of accessing their needs. Also, poverty makes people desperate, and thus, they do anything that will ensure they have food on their tables. Therefore, corruption flourishes in most societies because people do not know their rights and those that do have limited resources to access them.

Corruption violates the rights and freedoms of individuals to get basic services from public and private offices. This means that this practice compromises the quality of services offered by employees in the public and private sectors and puts the lives of citizens at risk. Corrupt officials do not offer equal services to clients because they treat some with more interests than others. This violates the provisions of equality and the rights for justice in various issues. This makes public institutions and offices to become illegitimate because of misusing their democratic power for private gains.

Also, corruption hinders the effective development of political systems in a country. This vice promotes patronage that is serious threats to democratic processes. Most corrupt nations experience civil disobedience and political instability that hamper development projects. The introduction of multi-party democratic systems is usually hampered by the corruption that compromises the legitimacy of political parties and individuals. Civil disobedience and lack of trust in political institutions propel individuals to protest and demand the removal of their leaders from power.

Moreover, this vice stalls development projects and subjects citizens to abject poverty because of a lack of transparency and accountability in public offices. Corruption enables few individuals that have money to have their way and get what they want while those that do not have been forced to look for other alternatives. Poverty and unemployment are common occurrences in societies that condone corruption, and they cannot develop because of poor management systems. The need to offer quality services like improving infrastructure, medical facilities, schools, and social amenities is compromised by the lack of transparent processes of awarding tenders and distributing resources in a society.

Lastly, this vice discourages unity and cooperation in society because some individuals think they are more important than others. Unequal distribution of national resources and restricted access to public services lead to frustration and apathy among citizens, and this weakens the fabric that binds members of the society. This leads to social inequality and the emergence of class differences that violate the dignity and rights of individuals. Uncontrolled corruption widens the gap between the rich and poor, and this results in a weak civil society.

Corruption is caused by man-made factors like capitalism, lack of transparency and accountability, nepotism, tribalism, poverty, weak social and political structures, and poverty. This vice lowers the pace of national development, weakens societies, and increases poverty. Therefore, people should work hard to ensure they fight corruption by educating their members on the importance of transparent practices. Also, government systems should be programmed to detect and eliminate this vice, and those found promoting it should face harsh penalties.

Johnston, M., Syndromes of Corruption: Wealth, Power, and Democracy. Cambridge:Cambridge University Press, 2009.

Turvey, B., Forensic Fraud: Evaluating Law Enforcement and Forensic Science Cultures in the Context of Examiner Misconduct . Massachussetts: Academic Press, 2013.

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Essay on Corruption for Students and Children


500+ Words Essay on Corruption

Essay on Corruption – Corruption refers to a form of criminal activity or dishonesty. It refers to an evil act by an individual or a group. Most noteworthy, this act compromises the rights and privileges of others. Furthermore, Corruption primarily includes activities like bribery or embezzlement. However, Corruption can take place in many ways. Most probably, people in positions of authority are susceptible to Corruption. Corruption certainly reflects greedy and selfish behavior.

Essay on Corruption

Methods of Corruption

First of all, Bribery is the most common method of Corruption. Bribery involves the improper use of favours and gifts in exchange for personal gain. Furthermore, the types of favours are diverse. Above all, the favours include money, gifts, company shares, sexual favours, employment , entertainment, and political benefits. Also, personal gain can be – giving preferential treatment and overlooking crime.

Embezzlement refers to the act of withholding assets for the purpose of theft. Furthermore, it takes place by one or more individuals who were entrusted with these assets. Above all, embezzlement is a type of financial fraud.

The graft is a global form of Corruption. Most noteworthy, it refers to the illegal use of a politician’s authority for personal gain. Furthermore, a popular way for the graft is misdirecting public funds for the benefit of politicians .

Extortion is another major method of Corruption. It means to obtain property, money or services illegally. Above all, this obtainment takes place by coercing individuals or organizations. Hence, Extortion is quite similar to blackmail.

Favouritism and nepotism is quite an old form of Corruption still in usage. This refers to a person favouring one’s own relatives and friends to jobs. This is certainly a very unfair practice. This is because many deserving candidates fail to get jobs.

Abuse of discretion is another method of Corruption. Here, a person misuses one’s power and authority. An example can be a judge unjustly dismissing a criminal’s case.

Finally, influence peddling is the last method here. This refers to illegally using one’s influence with the government or other authorized individuals. Furthermore, it takes place in order to obtain preferential treatment or favour.

Get the huge list of more than 500 Essay Topics and Ideas

Ways of Stopping Corruption

One important way of preventing Corruption is to give a better salary in a government job. Many government employees receive pretty low salaries. Therefore, they resort to bribery to meet their expenses. So, government employees should receive higher salaries. Consequently, high salaries would reduce their motivation and resolve to engage in bribery.

corruption causes and effects essay

Tough laws are very important for stopping Corruption. Above all, strict punishments need to be meted out to guilty individuals. Furthermore, there should be an efficient and quick implementation of strict laws.

Applying cameras in workplaces is an excellent way to prevent corruption. Above all, many individuals would refrain from indulging in Corruption due to fear of being caught. Furthermore, these individuals would have otherwise engaged in Corruption.

The government must make sure to keep inflation low. Due to the rise in prices, many people feel their incomes to be too low. Consequently, this increases Corruption among the masses. Businessmen raise prices to sell their stock of goods at higher prices. Furthermore, the politician supports them due to the benefits they receive.

To sum it up, Corruption is a great evil of society. This evil should be quickly eliminated from society. Corruption is the poison that has penetrated the minds of many individuals these days. Hopefully, with consistent political and social efforts, we can get rid of Corruption.

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Essay on Corruption in English for Children and Students

corruption causes and effects essay

Table of Contents

Essay on Corruption: Corruption is the use of power or position for personal gain. It can take many forms, from bribery and embezzlement to nepotism and cronyism. It can be found in both the public and private sectors, and its effects can be devastating to both individuals and society as a whole.

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Corruption refers to an act performed by an individual or a group, which seriously compromises the rights and privileges of someone else or the public in general. “Corruption” includes a significant number of illegal and immoral activities from different arenas of governance and administration. Corruption is not only limited to the government and its agencies, but, it also includes private businesses and organizations. Corruption severely hampers the growth and development of a society and a nation as a whole. A corrupt system makes people loose general trust in the government, resulting in an environment of fear and chaos.

Long and Short Essay on Corruption in India in English

We have provided below some Essay on Corruption of varying lengths in English for your information and knowledge.

These corruption essay have been written in simple and easy language so that you don’t face any difficulty in understanding the sentences.

The essay will give you an in depth analysis of Corruption and its effects on the society and the country.

You will also know the measures taken by the government to counter corruption and subdue its effects.

Essay on Corruption 100 words

Corruption is a poison which has been spread in the mind of wrong people of the society, community and country. It is the mistreatment of public resources just for getting some unfair advantage to fulfill little wish. It is concerned with the unnecessary and wrong use of both power and position by anyone whether in the government or non-government organization. It has affected the growth of the individual as we well as the nation and reduces income. It is a big reason of inequalities in the society and community. It affects the growth and development of the nation in all aspects like socially, economically and politically.

Essay on Corruption 150 words

Corruption is the misuse of public property, position, power and authority for fulfilling the selfish purposes to gain personal satisfactions. Corruption is the misuse of authority for personal gain of an individual or group. It is the unfair use of public power for some private advantages by breaking some rules and regulations made by government. Now a day, it has been spread deeply in the society and has become very strong because of its lots of roots. It is like a cancer which once generated cannot be ended without medicine and spreading its roots continuously.

One common form of corruption in our country is receiving cash money, through online transfer or in the form of costly gift etc. Some people wrongly uses someone else money for their own sake. Some people recruited in the government or non-government offices have been involved in the corruption and can do anything to fulfil their wishes.

The saying goes, “It’s a problem that affects everyone, from the least wealthy to the wealthiest. Corruption in India comes in different forms, like giving and taking bribes, stealing money, favoritism, and misusing public resources. The main reason for corruption in India is the absence of clear rules, responsibility, and a strong legal system.

Essay on Corruption 200 words

We all are well familiar of the corruption and as it is not a new phenomenon in our country. It has taken its roots so deeply in the people’s mind. It is a very common poison in the society since ancient time. It is available from the history time of the Mughal and Sultanate period. It is reaching to its new height. It has affected the mind of people to a great extent and become so common that wrong people can play with the public life. It is a type of greediness which corrupt human mind and destroy one’s humanity and naturalness.

Corruption is of different types which has been spread in every filed like education, sports, games, politics, etc. Because of the corruption, one does not understand his/her responsibilities at work place. Corruptions are like theft, dishonesty, wastage of public property, wastage of time unnecessarily, exploitation, scams, scandals, malpractice of responsibilities, etc are the various types of corruption. It has made its roots in both developing and well developed countries. We need to remove corruption from our society and country in order to get real freedom from the slavery. We all need to be loyal towards our responsibilities and strict for any type of greediness.

Essay on Corruption 250 words

Now-a-days, corruption is seen everywhere in the society just like an infectious disease. The great leaders of the India who have fought their whole life for removing corruption and other social issues completely from the society. It is the very shameful condition for us that even after losing various great lives, we are not able to understand our real responsibilities. Corruption has been spread in the common public lives, politics, central governments, state governments, businesses, industries, etc. It has not left any field. Corruption is increasing day by day instead of decreasing or steadying because of the continuous increase in the appetite of people for money, power, position and luxury.

We have forgotten the real responsibility of being a human just because of the money. We need to understand that money is not everything and it is not a stable thing. We cannot keep it forever to us, it can only give us greediness and corruption. We should give importance to the value based life and not money based life. It is true that we need lot of money to live a common life however it is not true that just for our selfishness and greediness; we should play someone’s life or money in some unfair ways.

Essay on Corruption 300 words

As we all know that corruption is very bad thing. It inhibits the individual growth as well as society and country growth and development. It is social evil which is playing humans body and mind socially, economically and intellectually. It is continuously making its roots so deeply because of the increasing human greediness towards money, power and position. Corruption is the misuse of authority, public position, natural or public resources, power, etc by someone to gain his/her personal gratifications. According to the sources, it has been identified that India ranks three in the highly corrupted countries.

Corruption is highly spread in the field of civil service, politics, business and other illegal fields. India is a famous country for its democracy but it is corruption which disturbs its democratic system. Politicians are highly responsible for all type of corruption in the country. We chose our leaders by having lots of expectations to them to lead our country in the right direction. In the starting they make us lots of promises however, just after the voting they forget all that and involve in corruption. We are sure that our India would be corruption free a day when our political leaders would be free of greediness and use their power, money, status and position in right direction to lead the country, not their own luxury and personal wishes.

We should select very honest and trustworthy leaders to lead our India just like our earlier Indian leaders such as Lal Bahadur Shastri, Sardar Vallabh Bhai Patel, etc. Only such political leaders can reduce and finally end the corruption from India. Youths of the country should also need to be aware of all the reasons of corruption and get together to solve it in group. Increasing level of the corruption needs to take some heavy steps to get control over it.

Essay on Corruption 400 words

Corruption is the highly infectious social disease which has spread its roots to the mind of the bad people. No one take birth to do such type of bad activities in the society however some bad conditions of their life forced them to do so. Gradually they become habitual for all of these bad activities. However, people suffering from any problem, disease, etc should keep patience and trust on themselves and never do anything bad in life. As, one negative step of anyone may harm the lives of many people. We are not a single entity on this earth, there are many like us, so we should think a little about others and live life happily and peacefully with positive thoughts.

Now-a-days, lots of benefits are given by the government of India to the poor people on the basis of various rules and regulations to bring social awareness among common people as well as equality in the society. However, poor people are not getting benefited of those advantages given by the government as many officers doing corruption secretly in between the channel before reaching to the poor people. They are doing corruption against law for just fulfilling their own pockets with money.

There are many causes of corruption in the society. Now-a-days political leaders are making interest oriented programmes and policies instead of nation oriented programmes and policies. They are just wishing to be famous politician for completing their own interests instead of citizen’s interests and requirement. There is increasing level of change in the value system in the human mind as well as decreasing ethical qualities of human being. The level of trust, faith and honesty is decreasing which gives rise to the corruption.

The number of common people with increased tolerance power towards corruption is increasing. There is a lack of strong public forum in the society in order to oppose the corruption, widespread illiteracy in rural areas, poor economic infrastructure, etc are the reasons of endemic corruption in the public life. Low salaries norms of the government employees force them towards channel of corruption. Complex laws and procedures of the government distract common people to get any type of help from government. During election time, corruption become at its highest peak. Politicians always take support of poor and illiterate people by dreaming them big in future during their governance however nothing happens after win.

Essay on Corruption 500 words

Corruption has been spread like a disease all over the India as well as abroad. It has become one of the most speedily increasing social issues in the Indian society . It is generally initiated and promoted by the opportunistic leaders. They never think about the nation’s benefits and do lots of damage to the nation through their corruption even for their small advantage. They sell their country properties in the wrong hands and spread wrong beliefs about India in the people’s mind living in other countries.

They are spoiling the old traditions and cultures of India for their personal benefits. Now-a-days people who are working in right direction using right principles considered as foolish in the modern society and the people who are working wrong and making wrong promises are good for the society. However, in turn it is true that corrupted people cheating the simple, ordinary and innocent people. They are ruling the mind of innocent people.

Corruption increases in India day by day because there is a strong connection between the officials, politicians and criminals who are making this country weak and so weak. India got independence in 1947 and it was slowly becoming strong and developing but in the mid way the disease of corruption started and stop India to grow ahead. In India there has been a trend of give and take means give some money in order to get your work done whether in the government offices or private sectors offices. And now the condition is getting worse and worse, as earlier, the money was paid for getting wrong works done or only work to be done, but currently money is paid for getting works done in right ways and at right time. Even after paying complete money according to the demand, there is no full chance of getting things done at time and in right way.

Corruption is everywhere in every department whether it hospitals, education, job, government offices, nothing is left of corruption. Everything has become a business and the source of earning money in wrong way. Educational institutions are also involved in the corruption and they give seat to those students only who have paid for, whether they are good students with good marks or not. Very weak students are given admission in the top colleges and universities only on the basis of money paid for wrong admission and the topper student with good marks and lack of money gets back in the life or take admission in any simple college.

Now-a-days, private sectors companies are so good in comparison to the governmental jobs. Private companies are giving job on the basis of candidate’s skills, ability, technical knowledge, good percentage of marks and all the educational records. However, it has become tough to get job in the government offices as they need lots of bribe to give any type of job (high level or low level) like teaching, clerk, babu, nurse, doctor, sweeper, etc. And the amount of bribe increases in the market as the level of job increase like IAS, PCC, police, etc ranks jobs.

All the essays given above are essay on corruption under various words limit according to the student’s need and requirement in the school. All the corruption essay are written to almost fulfill the current need of students. Corruption is a social issue and this topic is in vogue for the student’s awareness. Following are the other social issues on which we have provided varieties of essays:

Long Essay on Corruption – 1700 words

A majority of us are probably aware of the term “corruption” and the situations in which the word perfectly fits in. The most plausible reference to the nature of corruption could be assessed by the words of Joe Bidden, 47 th Vice President of the United States of America, who quoted – “corruption is just another form of tyranny.” The statement weighs corruption as equivalent to that of cruel and oppressive rule of government. However, for a common man/woman, corruption is a challenge, that he/she faces every day, in protecting of his/her fundamental rights and privileges, otherwise guaranteed by the Constitution.

Corruption in India

Though, the ranking of India in Global Corruption Index 2018 has been improved by three places; at a global rank of 78 it’s still far from becoming a corruption free nation.

Corruption in India had been prevalent even under the subjugation of British Empire, when India was still far from gaining independence. How deeply rooted was the corruption in Indian society, can be assessed by the words of Mohammed Ali Jinnah. The Muslim League Leader once stated – “One of the biggest curses from which India is suffering – I do not say that other countries are free from it, but I think our condition is much worse – is bribery and corruption. That really is a poison”.

This statement of Mr. Jinnah delivered while addressing the first Presidential address to the Constituent Assembly of Pakistan on 11 th August 1947, bares naked the truth of corruption in India, even before independence.

Even after 73 years of Independence, not much has changed on that front for the people of India. On the contrary, corruption has grown in dimension and today, it seriously hampers the economical, social and infrastructural progress of the nation as never before.

Corruption in political and administrative system of the country, is curtailing its progress and it devoid the people of India of their basic rights of equality, freedom, right to equal opportunity and right to compulsory education and health among others.

Factors Leading to or Responsible for Corruption

The corruption is rooted into several social, political and economical factors. Though, the most elaborate explanation for the cause of corruption could be estimated by the words of 19 th century British politician Lord Acten, who had famously said – “Power tends to corrupt and absolute power corrupts absolutely.”

The quote was a reference to relationship between power and corruption. Corruption is most like to occur with power as the powerful can successfully evade accountability, by using his/her power and influence.

The scenario explained above gels perfectly with the Indian political and administrative system of governance. Huge powers are vested upon our political representatives and administrative officials, by the Constitution. The motive behind bestowing them with power was the greater idea of empowering them to act as facilitators to the public, in general interest of the nation.

They are expected to exercise their powers in implementing several welfare schemes and projects, without any hindrance, for the overall welfare of the people and progress of the nation. However, the whole idea seems to backfiring with, the powerful wielding the powers to their own interests, seriously compromising the interest of the nation and its people.

This is when the corruption slowly seeps into otherwise honest political and administrative circles of India.

Another, most troubling factor behind the prevalence of corruption in India is the latter’s acceptance in society as a common phenomenon. Today, the voices against corruption are fainter than ever before and the people have accepted corruption as natural and unavoidable.

This is the reason why we tend to bribe public servants, to escape the legal formalities on issues those are of interest to us. Moreover, giving and taking bribe is today being considered as a wise act and is being applauded in private, if not publically.

Below is given a point wise narration of other social and economical factors that could escalate corruption –

  • Inadequate compensation and monthly emoluments to the government employees could lead them to corruption.
  • Illiteracy fuels corruption as it makes a person more submissive and likely to be exploited by greedy officials.
  • Illiteracy, poverty and lack of a transparent grievance redressal system make people more vulnerable to political and other types of corruption.
  • A decline of ethics and moral values in the society are also responsible for corruption.
  • Lack of awareness among the people on their rights and privileges is acting as a fuel to the corruption.

Different Faces of Corruption

The demon of corruption has many faces, than could be imagined, like judicial corruption, governance corruption, corruption in education, corruption in enforcement of laws, financial corruption, political corruption etc. There could be thousands of other similar situations; those could act as examples of corruption. It wouldn’t be possible to elaborate all types of corruption in this essay; however, we will discuss a few of them below.

  • The spectrum of corruption is vast enough to affect people from different walks of life. It involves situations like bribing to secure a government job, bribing to lodge a complaint in local police station, bribing the government doctor for treatment, bribing the official for swift movement of file, paying bribe to the official to get the cheque that you deserve anyway.
  • Firstly, we will make an assessment of political corruption in India. We all know that the credibility of a political representative is based on the transparent and unbiased election that he or she faces in order to be elected. Despite the Election Commission of India doing a commendable job every time to conduct free and fair elections, there are still some cracks in the otherwise impeccable election system.
  • More often than not, during elections, we get stray news from throughout the nation, of voters being influenced by money or by wielding powers, by the contestants in election. Such acts amount to political corruption of highest degree and can adversely influence the democratic structure of the nation.
  • Now let’s consider the scenario of a government hospital which functions to provide free or subsidized medical facilities to all the citizens of India. The doctors deployed by the government in the hospitals are compensated adequately for their services; however, sometimes they are seen demanding money from patients to perform an operation or treatment, which should otherwise be performed free of cost. This is a perfect example of corruption in healthcare system.

Likewise there are several examples of corruption in different sectors, depending on their nature and outcome.

Corruption – An Act of Collusion or Not

Corruption is basically an act of collusion between two parties; however, more often than not one party might be forced into the agreement by another party.

Suppose, if a Public Works Department Engineer demands bribe from a civil contractor, for passing the bill for the portion of road constructed by the latter. In this case, though the demand is not obligatory on the contractor, he/she will mostly oblige considering the otherwise cumbersome process of proceeding legally against the demands. In this case the party who gives bribe is actually forced to do so by the party who demands it.

On the contrary, there could be situations in which both the opposite parties have colluded willingly in order to mutually benefit each other. For example a non deserving candidate for a government job, pays bribe to the recruiting official, in order to secure the job.

Nevertheless, whether forced or mutually agreed upon, corruption is an act of collusion, between two parties, which seriously compromises the privileges and rights of other individuals.

Measures to Counter/Control Corruption in India

The corruption in any sector could be effectively controlled by working on improving transparency and accountability in that particular sector. Transparency will ensure that each and every functioning, decision and its outcome is known to the public and all, so that the fairness of the deal could be ascertained. On the other hand accountability places responsibility of an undesirable outcome/loss on an individual.

  • This has been done by the government of India under the Right to Information or the RTI act, which had been incorporated in 2005. RTI Act 2005 gives the power of questioning to the common citizen of India. Using the RTI Act anyone could now question any department by simply submitting a RTI application.
  • You can now question and get answers on subjects like – how much of the taxes collected, did the government spend and on what mode; how many children in your neighboring school were provided admission under EWS (Economically Weaker Section); what was the cost incurred for the construction of road in your locality and what amount was paid to the contractor; what action did the government take against the official involved in corruption etc.
  • The RTI law mandates the appointment of a Public Information Officer (PIO) in all the central and state runs departments and ministries. The provision of responding to the queries is binding on the PIO, who has to do so in a stipulated time, failing which s/he would attract departmental action or a hefty fine.
  • The government has also established Central Vigilance Commission (CVC) in 1964 to look into the matters of governmental corruption. The CVC functions as an autonomous body, free from the influence of any executive authority.
  • The Government has amended Prevention of Corruption Act 1988, to criminalize the party which pays bribe for undue advantages.
  • The amendments have a provision to impose penalty on the organization of the person convicted for giving or taking bribery, if latter couldn’t be traced or has deliberately left the country to escape law.
  • Another step that could well be taken to eliminate corruption is, setting up a fast and speedy judicial system, to address the corruption cases in the country.

Though, the corruption is rampant in India, it is also true that by and large the common men and women of India are honest and have an evident dislike for corruption. However, deep rooted the corruption might be, it could be successfully eliminated with political will and public awareness.

Essay on Corruption FAQs

What is corruption in an essay.

Corruption in an essay refers to the act of dishonesty or misuse of power for personal gain, often involving bribery, embezzlement, or unethical behavior.

How do you write a corruption essay?

To write a corruption essay, start with an introduction, discuss its forms and impact, provide real-life examples, and conclude with solutions to tackle this issue.

What is corruption in 200 words?

Corruption is a dishonest act where individuals misuse their authority for personal benefit, leading to societal harm and mistrust. It includes bribery, fraud, and embezzlement.

What are the points of corruption in India?

Corruption in India involves bribery, political scandals, irregularities in government contracts, and a lack of transparency, leading to social and economic problems.

What is corruption in India in simple words?

Corruption in India means people in power using their position for personal gain, leading to unfairness and inequality.

What is corruption in very simple words?

Corruption, in the simplest terms, is when people with authority do bad things for their own benefit, causing harm to others and breaking the rules.

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Home > Books > Trade and Global Market

Corruption, Causes and Consequences

Submitted: 17 October 2017 Reviewed: 06 December 2017 Published: 21 February 2018

DOI: 10.5772/intechopen.72953

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Corruption is a constant in the society and occurs in all civilizations; however, it has only been in the past 20 years that this phenomenon has begun being seriously explored. It has many different shapes as well as many various effects, both on the economy and the society at large. Among the most common causes of corruption are the political and economic environment, professional ethics and morality and, of course, habits, customs, tradition and demography. Its effects on the economy (and also on the wider society) are well researched, yet still not completely. Corruption thus inhibits economic growth and affects business operations, employment and investments. It also reduces tax revenue and the effectiveness of various financial assistance programs. The wider society is influenced by a high degree of corruption in terms of lowering of trust in the law and the rule of law, education and consequently the quality of life (access to infrastructure, health care). There also does not exist an unambiguous answer as to how to deal with corruption. Something that works in one country or in one region will not necessarily be successful in another. This chapter tries to answer at least a few questions about corruption and the causes for it, its consequences and how to deal with it successfully.

  • economic growth
  • rule of law

Author Information

Štefan šumah *.

  • FKPV Celje, Slovenia

*Address all correspondence to: [email protected]

1. Introduction

The word corruption is derived from the Latin word “corruptus,” which means “corrupted” and, in legal terms, the abuse of a trusted position in one of the branches of power (executive, legislative and judicial) or in political or other organizations with the intention of obtaining material benefit which is not legally justified for itself or for others.

Corruption was referred to as a great sin already in the Bible: “Do not accept a bribe, for a bribe blinds those who see and twist the words of the innocent.” However, the history of corruption is in fact related to the beginning of the creation of law and the state and was already in the antiquity considered an evil, which negatively affects the public administration and the functioning of the political system. The earliest records of corruption date back to the thirteenth century BC, to the time of the Assyrian civilization. From the found plates, written in cuneiform, the archeologists managed to discern how and who accepted bribes. Under the Roman law, the criminal offense of corruption was defined as giving, receiving or claiming benefits in order to influence an official in connection with his work. Due to the prevalence of corruption in the country, this law was supplemented by a new law, which predicted compensation for damage in double value of the damage, and the loss of political rights for the perpetrator of the corruptive act. However, this did not help alleviate corruption, especially due to the fact that corruption was most practiced by the members of the Senate and senior state officials, both in Rome itself and in the remote Roman provinces. The early Christian faith condemned corruption, yet corruption later also developed greatly in ecclesiastical structures, and achieved its peak with the selling of indulgences in the Middle Ages, all until the condemnation of the latter (as well as of other immoral acts of the clergy, with the Pope at the head) by Martin Luther. Apart from the condemnation of corruption, the Reformation also led to a break with until then dominant Catholic culture and the emergence of Protestant ethics.

As a child (he was a hostage at the Ravenna court), Attila 1 noticed a high level of corruption among the state officials of the Western Roman Empire and how they appropriated the state money (as a consequence, there was less money in the Treasury and therefore the taxes increased). He thus decided that if he would ever to rule, he would do so fairly and by oppressing the corruption in his own country. The early feudalism was familiar with various laws that punished the bribing of courts also with death. Later, when the developed feudalism again turned to the Roman law, a number of laws (Dušan’s Code, Mirror of the Swabians) discussed the abuse of position. Then, in late Feudalism, countries became virtually helpless in the fight against corruption, as illustrated by the case of France, which in 1716 established a special court in which should rule in cases of abuse of royal finances; however, these abuses (embezzlement, extortion, bribery, scams, etc.) were so extensive that the court was abolished and a general amnesty introduced in 1717 made some forms of corruption quite a tradition. The corruption was also widespread during the time of the Spanish Inquisition, where the victim of the accusation could make amends with money, which made the corruption, especially among the inquisitors, extensive.

Throughout the history, many intellectuals dealt with corruption or theorized about it one way or another. Machiavelli 2 had a low opinion on republics, considering them even more corrupt than other regimes, and according to him, corruption leads to moral degradation, bad education and bad faith. On the other hand, however, the great philosopher, diplomat and lawyer Sir Francis Bacon 3 was known both for receiving bribes and taking them. When he reached the highest judicial position in England, he was caught in as many as 28 cases of accepting a bribe and defended himself before the parliament by saying that he usually accepted a bribe from both parties involved and that the dirty money therefore did not affect his decisions. The parliament did not accept these arguments and sent him to the jail where he spent only a few days as he was able to bribe the judge.

Thus, although the corruption has been occurring in society ever since, it has only been given more attention in the recent period—the researches on the phenomenon and its negative impacts have become more common after 1995, when countries and international institutions began to be aware of this problem. The attitude of the public toward corruption was, until then, neutral. In 1998, Kaufmann and Gray [ 1 ] found that:

Bribery is widespread, especially in the developing and transition countries; there are, however, significant differences between and within regions.

Bribery increases transaction costs and creates insecurity in the economy.

Bribery usually leads to ineffective economic results, in the long term impedes foreign and domestic investments, reallocates talents due to income and distorts sectorial priorities and technology choices (for example, it creates incentives for contracting major defense projects or unnecessary infrastructure projects, but does not encourage investments in rural specialist health clinics or in preventive health care). This pushes companies into the “underground” (outside the formal sector), weakens the state’s ability to increase revenue and leads to ever-increasing tax rates (as too little tax is taken), which is levied on less and less taxpayers, consequently diminishing the state’s ability to provide enough public goods, including the rule of law.

Bribery is unfair, as it imposes a regressive tax, which heavily burdens in particular commercial and service activities performed by small businesses.

Corruption destroys the legitimacy of the state.

Many other researchers and institutions (the World Bank Institute—WBI, the European Commission, the United Nations, the EBRD) have investigated corruption and its impact on macroeconomic and microeconomic indicators through various forms of corruption, as well as its connection with local customs and habits, and how it affects the everyday lives of people. Most studies are therefore mainly the analyses of the effects of corruption on various economic indicators, such as GDP growth, investments, employment, tax revenues and foreign investments [ 2 , 3 , 4 , 5 ], or the study of various forms of corruption in relation to politics and the economic environment [ 6 ], the research of its social condition and various manifestations [ 7 , 8 ]. Dobovšek [ 9 ] agrees with the negative effects, i.e. high economic, political and social costs, and adds that corruption is not a weakness of people but of institutions (supervisory and other), as they should be the ones to obstruct the greed and temptation of individuals within them.

2. Causes of corruption

Although corruption differs from country to country, it is possible to identify some of the key common driving forces that generate it. What is common to all countries, which are among the most corrupt, has been identified by Svensson [ 10 ]; all of them are developing countries or countries in transition,

with rare exceptions, low-income countries,

most countries have a closed economy,

the influence of religion is visible (Protestant countries have far the lowest level of corruption),

low media freedom and

a relatively low level of education.

Regardless of the above, corruption cannot be assessed unambiguously, since there is never only one phenomenon that is responsible for the occurrence and the development of it; corruption always arises from an array of several, interrelated factors, which can differ considerably from one another. Among the most commonly mentioned factors that influence the development of corruption are: political and economic environment, professional ethics and legislation, as well as purely ethnological factors, such as customs, habits and traditions.

2.1. Political and economic environment

The phenomenon of corruption is strongly influenced by the political and economic environment. The more is the economic activity in the country regulated and limited, the higher the authority and the power of officials in decision making and the greater the possibility of corruption, since individuals are willing to pay or offer payment in order to avoid restrictions. A great potential for corruption is especially there where the officials are under the regulation given the opportunity to decide on the basis of discretion.

The level of corruption is also affected by the monetary policy. Goel and Nelson [ 11 ] in their research found a strong link between monetary policy and corruptive activity in the States. The States that have a well-regulated financial sector, not a lot of informal economy or black market are also less corrupt than those where the opposite is true. They also find that there is less corruption in the countries with higher economic and political freedom.

Dimant [ 12 ] puts it well in his claim that the level of efficiency of public administration determines the extent to which corruption can find fertile soil and sprout. Such efficiency is determined by the quality of the regulations and permits, since ineffective and unclear regulations help to increase the level of corruption in at least two different ways:

The artificially created monopoly of power that enables civil servants to obtain bribes is based on their superior position and embedded in the system.

On the other hand, however, ineffective and unclear regulations cause inhibition and therefore encourage natural persons to pay bribes in order to speed up the bureaucratic procedure.

Corruption is also strongly influenced by the low salaries of public administration employees (state officials), who are therefore trying to improve their financial position by receiving bribes, and consequently, the socio-economic situation of the government officials also affects the phenomenon of corruption. This is demonstrated also by Allen et al. [ 13 ] in their study where they find that corruption arises because agencies, institutions and the government can no longer control corruption effectively due to underpaid officials, which is a problem especially in the developing countries, where they do not have the sufficient tax revenue to properly reward the local officials. However, low wages are not the only cause of corruption; the poor state of the public administration, which is a consequence of political “overcrowding” 4 of officials, due to which loyalty usually prevails over professional standards, also strongly affects the corruption. As an important factor influencing corruption, some authors also indicate satisfaction with the work done by officials—the more they are dissatisfied with their work or place of work, the higher the degree of corruption, which is confirmed by Sardžoska and Tang [ 14 ] in their studies. The mentioned authors find that the private sector has higher ethical values, in particular those that affect satisfaction with work, than the public sector and is therefore less unethical (especially regarding thefts and corruption). Indirectly, Svenson [ 10 ] also affirms this and states that in principle, the salary level of civil servants affects the receipt of a bribe (the higher it is, the smaller the chance that the person will act corruptly). However, he continues on that a higher salary also strengthens the negotiating power of the official, which leads to higher bribes and he also states that, on the basis of existing research, it is very difficult to determine whether a higher salary causes less corruption, which means that the level of salary is not a decisive factor, but merely one of many.

The economy is unfortunately largely dependent on politics and often reflects the rule of law; various options for eliminating competition are exploited, and bribery is just one of the possible weapons in the struggle to gain a job. At the same time is the mentality of the economy sometimes: “The cost of a bribe is only a substantial business cost, an integral part of the contract,” or “Even if we stop the bribery, our rivals will not, so we must bribe in order to remain competitive, “or” bribery and misleading behaviour are not really crimes, they are just part of the old business practice. They are part of the game and everyone does it.” On the other hand is the point sometimes simply the “lubricating” of the bureaucratic wheel by the private sector to do certain things faster or easier.

The political influence of corruption is also manifested through the proverb: examples are attractive! If the top of the politics (government, parties and leading politicians) is corrupt, then corruption shows at all levels, and this evil at the same time spreads among the ordinary population, as nobody trusts the institutions or the rule of law. Johnston [ 15 ] thus points out useful thinking in terms of two types of equilibrium—the balance between the openness and the autonomy of the institutions and elites it leads and the balance between political and economic power and opportunities for cooperation. Ideally, the institutions should be open to influences and feedback from different sources, yet at the same time sufficiently independent to effectively carry out their work. Where the openness and independence of the institutions are in balance, the officials are accessible, but not excessively exposed to private influences; if they can make authoritative decisions, while not using their power to arbitrate, the corruption is relatively low. But where the official power is poorly institutionalized, too exposed to private influence, and the officials’ independence is reflected in excessive exploitation of their power—they can do as they please—the possibility for extreme corruption is again high.

2.2. Professional ethics and legislation

Lack of professional ethics and deficient laws regulating corruption as a criminal offense, and the prosecution and sanctioning of it are also an important cause for the emergence and spread of corruption. A great influence comes also from the ineffective sanctioning of corruption, which only increases the possibility of continuing the corruptive actions of those involved, creating at the same time a strong likelihood that others will join in the corruption due to this inefficient sanctioning.

The sole lack of professional ethics is a particular issue, as the administration requires different amounts of time to develop or change its ethics and professional standards, which is well known in transition countries (in some, ethics and professional standards changed overnight and approached the equivalents in the developed democracies, and in some, they remained the same as in socialism). It is precisely in the transition countries that the “softer” acts of corruption are often considered to be acceptable and justifiable. Therefore, due to lack of professional ethics in some countries that otherwise manage illegal corruption well, there is nevertheless a widespread form of legal corruption.

Corruption also generates a lack of transparency and a lack of control by supervisory institutions. Therefore, where there is insufficient legal basis or sufficient political will to control, which enables a non-transparent functioning of both politics and the economy, corruption flourishes. Corruption is also affected by the extensive, non-transparent or incomplete legislation, where laws can be interpreted in different ways (for the benefit of the one who pays).

2.3. Habits, customs, tradition and demography

Different countries have different attitudes to corruption. In Europe alone, we can find two extremes; from completely corruption intolerant North to the warm South, where corruption is an almost normal, socially acceptable phenomenon. Or the difference between countries with a democratic past, which traditionally prosecute corruption, and former socialist countries, where the corruption in the state apparatus was a part of folklore tradition. Then, there are also different customs; in some cases, a “thank you” in the form of a gift for a service (for which this person has already been paid with a salary) is an expression of courtesy, and elsewhere it is considered corruption. Everything is only a matter of ethics and morality; however, they can be very different in different areas and different countries.

Some forms of corruption also relate to an informal form of social security, where the family or the immediate community takes care of its members. Such forms of informal social security prevail in less developed countries, where there is no legal regulation of formal social security and in the countries of Southern Europe where the influence of the broader family (patriarchate 5 ) is still very strong, like for example in Italy, Greece, Albania, Bosnia, etc. These countries are known for nepotism, cronyism and patronage, since the family as well as the wider community provide social security. The family or community takes care of their members, who, in return, must be loyal and in a way also repay the benefits they receive from it. The same is true of faith. While the southern, predominantly Catholic, very hierarchically organized part of Europe, encourages the cult of the family (also joint and several community) and several liability, the northern, mainly Protestant part, emphasizes individualism and individual responsibility (which means less forms of corruption). The corruption also prospers better in countries where Islam and Orthodoxy are the main religion. The influence of the dominant religion in the country is thus important.

The influence of majority Protestantism has been tested several times and has proven to be an important factor for the low level of corruption in a country. However, the relationship between Protestantism and good governance is probably rooted more in history than in today’s practice. Today, there are many nominally Protestant countries that are de facto secular, while also many non-Protestant countries fight effectively against corruption. Thus, the influence of Protestantism appears to emerge from its egalitarian ethos, which could indirectly function as a support to the general orientation toward ethical universalism, literacy and the promotion of individualism. Its role is therefore important, as it at certain stages of the development explains why the first countries that were well managed were predominantly Protestant. This does not mean that other religious traditions are incompatible with good governance, but only that they have not succeeded in compiling this particular array of factors at the right moment [ 16 ].

Similarly, the research by North et al. [ 17 ] showed that, according to the authors, the least corrupt countries or those countries where the rule of law is the strongest were predominantly Protestant in 1900 and those who are most corrupt were predominantly Orthodox in the same year. The results of their research have shown that there is a link between religion and corruption on one hand, and respect for the rule of law on the other, but not that the link is causative. The questions therefore arise: Why do some religions respect the rule of law more than others and control corruption? Do the characteristics of a particular religion themselves lead to the results? Are there any differences in religious doctrines, practices or cultures that lead to such results? Are there other links that are not rooted in the religious culture, but are related to religious affiliation?

A study titled Perception of corruption by authors Melgar et al. [ 18 ] tried to find out which groups of people are more likely to pay for corruption. They found that those who think that there is a lot of corruption also perceive it so and are consequently more willing to pay for it (as they think or expect the society to function that way). By using a wide and very heterogeneous set of data and econometrics, it has been shown that the social status and personal characteristics also play an important role in the shaping of corruption perception at the micro level. While divorced women, unemployed persons, persons working in the private sector or the self-employed are considered to be in positive correlation with the perception of corruption (corruption is perceived more and they are more willing to pay bribes), the opposite applies to married persons, full-time employees, people who frequently attend religious ceremonies and people with at least secondary education (they perceive less corruption and are also unwilling to pay). According to the classification of countries, they find that it can be proved that all African and Asian countries are in the upper half of the table, and the same applies to the former socialist countries and most of the East Asian countries. People living in these countries perceive more corruption than others. On the contrary, most European countries and some of the former English colonies show lower perceptions than the average (there are also exceptions) and rank in the lower half, the same as half of the richest countries. They also added that the geographical classification of countries has been strongly correlated with the corruption perception index (CPI), which shows that individual characteristics and social conditions are specific factors that influence the perception of corruption. However, they have also found that better economic results reduce the perception of corruption, while the macroeconomic instability and income inequalities have precisely the opposite effect. With Mahič [ 19 ], we also found a similar influence on the perception of corruption; in the economic crisis (high unemployment and low purchasing power), the perception of corruption is rising.

A very important factor that affects corruption is also demographics. A number of studies have shown that patriarchal society is more prone to corruption. This is confirmed by several researches that actually explore to what extent are men women corrupt. Several earlier, especially econometric contributions to the debate on who is more corrupt, men or women, argued that there is a link between a higher representation of women in government and lower levels of corruption. An influential study of 150 countries in Europe, Africa and Asia by the World Bank [ 20 ] confirmed this and concluded that women are more reliable and less prone to corruption. The subsequent findings were later reinforced by further research. Rivas [ 21 ] also affirms this in his research and notes that, according to the results of the survey, the conclusion could be that women are less corrupt than men and that the increase in the number of women on the labor market and in politics would help fight corruption. Lee and Guven [ 22 ] in the survey: Engaging in corruption—the influence of cultural values and the contagion effects at the micro-level also raised the question of whether men are more corrupt than women. The findings of the research support the thesis that women are less susceptible to corruption than men, especially in cultures that require men to be ambitious, competitive and materially successful, as these factors significantly contribute to unethical behavior. This was surprisingly well shown also in practice [ 23 ] when, due to gender equality, the Peruvian government a decade ago decided to involve more women in the police units. When the 2,500 female police officers were joined as traffic police officers, something unexpected happened; bribery was drastically reduced, and people welcomed the female police officers on the streets.

3. The impact of corruption on the economy

In 1997, Tanzi and Davoodi [ 2 ] conducted a systematic study of the impact of corruption on public finances. Several important findings came to light:

Corruption increases the volume of public investments (at the expense of private investments), as there are many options that allow for public expenditure manipulation and are carried out by high-level officials so as to get bribes (which means that more general government expenditures or a large budget offer more opportunities for corruption).

Corruption redirects the composition of public expenditure from the expenditure necessary for basic functioning and maintenance to expenditure on new equipment.

Corruption tends to pull away the composition of public expenditure from the necessary fixed assets for health and education, as there is less chance of getting commissions than from other, perhaps unnecessary projects.

Corruption reduces the effectiveness of public investments and the infrastructure of a country.

Corruption can reduce tax revenues by compromising the ability of the state administration to collect taxes and fees, although the net effect depends on how the nominal tax and other regulatory burdens were selected by the officials, exposed to corruption.

The influence of corruption on the economy was studied by the same authors [ 3 ] through several factors:

Through the impact of corruption on businesses : The impact of corruption on a business is largely depend on the size of the company. Large companies are better protected in an environment that is prone to corruption, they avoid taxes more easily and their size protects them from petty corruption, while they are often also politically protected, which is why the survival of small (especially start-up companies) and middle-sized companies, regardless of their importance for the growth of the economy and the development, is much more difficult than the survival of large companies.

Through the impact of corruption on investments : Corruption affects (a) total investments, (b) the size and form of investments by foreign direct investors, (c) the size of public investments and (d) the quality of investment decisions and investment projects.

Through the influence of corruption on the allocation of talents : Indirectly, corruption has a negative impact on economic growth through the allocation of talents, since gifted and prospective students are driven, due to the influence of the environment and the situation in the country, for example, to study law rather than engineering, which would add value to the country.

Through the impact of corruption on public spending : Corruption has a negative impact on public spending and has an especially strong impact on education and health. There are also indications of the correlation between corruption and military expenditure, which means that high level of corruption reduces economic growth due to high military expenditure.

Through the impact of corruption on taxes : Because of corruption, less taxes are levied than would otherwise be, as some of the taxes end up in the pockets of corrupt tax officials. There are also frequent tax relieves in the corrupt countries, selective taxes and various progressive taxes; in short, there is much less money than the country could have, and so corruption, through the country’s financial deficit, also affects the economic growth; and conclude the findings on the negative impact (both indirect and direct) of corruption on economic growth.

Smarzynska and Wei [ 5 ] came to similar conclusions regarding the effects of corruption on the size and composition of investments. Corrupt countries are less attractive for investors, and if they do opt for an investment, due to non-transparent bureaucracy, they often enter the market with a joint venture, as they usually understand or control matters of the home country better. The local partner can also help foreign companies with the acquisition of local licenses and permits or can otherwise negotiate with the bureaucratic labyrinths at lower costs. Generally inclined (as investors) to the joint venture in the corrupt countries are especially the US investors; however, even investors from those European countries, which are among the highest ranked on the CPI, quickly adapt to local conditions.

Corruption for various reasons also affects the following:

Employment, because the job does not go to the most suitable or qualified person, but the one who is ready to pay for it or in any other way return the favor.

Also affects total investments [ 24 ].

The size and composition of foreign investments and the size of public investments.

The effectiveness of investment decisions and projects. In the presence of corruption, the investments are smaller, as entrepreneurs are aware that they will have to bribe the officials or even give them a profit share for a successful implementation of a business. Due to these increased costs, the entrepreneurs are not interested in investing.

Wei [ 25 ] even made a projection which predicted that in the case of reduction in corruption in Bangladesh to the level of corruption in Singapore, the growth rate of GDP per capita would increase by 1.8% per year between 1960 and 1985 (assuming that the actual average annual growth rate was 4% per year), and the average per capita income could have been more than 50% higher, whereas the Philippines could, if its level of corruption was reduced to that of Singapore (if everything remained unchanged), have raised their investments in relation to GDP by as much as 6.6%, which means a significant increase in the investments. At the same time, he notes that in order to reduce the corruption to the level of Singapore in the countries that he compared (India, Kenya, Sri Lanka, Turkey, Colombia, Mexico and Ghana), the State should raise the salaries of officials by 400—900%. He therefore asks himself whether this would even be possible. However, he notes that in the event of a large increase in salaries, a new form of corruption would likely arise when everyone would be prepared to pay a bribe for a well-paid official job.

Corruption often reduces the effectiveness of various financial assistance programs (both state and international), as money is “lost somewhere along the way” and does not reach those that need it or for whom it is intended, as the financial benefits, deriving from corruption, are not taxable because they are hidden. The state is thus also losing part of the income from the taxes due to corruption, while the public spending, resulting from corruption (or narrow private interests) leads to negative effects on the budget.

The European Commission in its report found that corruption is costing the European economy about 120 billion a year, and according to the European Commissioner for Home Affairs, Cecilia Malstotröm, the corruption in Europe is most present in public procurement, financing of political parties and health care [ 26 ].

The United Nations estimate that the cost of corruption in Afghanistan amounted to about $ 3.9 billion in 2012. According to Transparency International, the former leader of Indonesia, Suharto, embezzled between $ 15 and $ 35 billion, whereas the embezzlements of Mobutu in Zaire, Ferdinand Marcos in the Philippines and Abacha in Nigeria are estimated to amount to $ 5 billion [ 27 ]. However, the World Bank survey shows that $ 1 billion in bribes, both in rich and developing countries, is paid annually [ 28 ], which means that even the developed countries are not immune to corruption (but in a different form) and that the political corruption is especially present in large infrastructure projects. Bađun [ 29 ] on the example of Croatia gives conclusions, which are valid for all post-communist countries.

Impact on enterprises: A survey conducted by the EBRD and the World Bank shows that bribes paid in smaller companies account for 5% of their annual profits and in medium-sized companies 4% of their annual profits. However, both are, compared to large companies, where bribes comprise less than 3%, in a much worse position, which shows how bribes are causing problems or are putting these smaller companies into a subordinate position compared to the large ones, which in turn leads to the collapse of these.

Also interesting is the study of the Shadow Economy in Highly Developed OECD Countries where Schneider and Buehn [ 30 ] also find the link between the low quality of institutions that are the holders of the rule of law (or degree of corruption) and the shadow economy, and therefore, the weaker the “law” is, the higher the degree of corruption and of shadow economy. In the study Corruption and the Shadow Economy [ 31 ], the same authors explore the relationship between the degree of corruption and the emergence of the shadow economy, and their findings are that the high level of shadow economy and the high degree of corruption are strongly linked to one another. One of the hypotheses in this survey (which has been confirmed) is also: the higher the degree of corruption, the lower the economic development measured by GDP per capita. The authors detected a positive correlation; corruption thus affects the economic development.

However, the extended practice of finding annuity outside the logic of the market and competition can therefore lead to a (neo) liberal conclusion that the root of the existence of corruption is in the very existence of the state—especially in excessive, selective and deforming state interventions and subsidies that create fertile soil for the development of corruption. The truth is that the devastating combination consists of widespread state intervention and subsidies in the simultaneous absence of a strong institutional framework and detailed rules of the game, including the control of public finances and effective anti-trust legislation and legal practices. On the other hand, however, there is no clear evidence that private monopolies are more effective and less corrupt than the public ones and that privatization, especially long-lasting, gradual and non-transparent one (so-called gradualism), reduces positive developmental and social effects, including the reduction of corruption [ 32 ]. Yet market deregulation, legal and judicial reform and transparent management of public procurement would significantly reduce corruption in many developing countries (as well as in transition countries), at which point the government should play an important role in the shaping of the anti-corruption policy. There should be a strong strengthening of the public procurement institution. The law is admittedly strict about the public procurement, but one of the main reasons for public procurement problems is the lack of a skilled workforce, and public procurement is thus still the breeding ground of corruption. There also exists a proverb “poverty is a curse,” which applies largely to all developing countries, as these are the countries that are most affected by poverty. Poverty destroys all ethical and moral values.

One of the important aspects of the damage to the global economy is also the failure to respect copyright and intellectual property. The more corrupt countries are also inclined to lower respect for the aforementioned, and the economic damage amounts to billions of dollars. Cavazos-Cepeda et al. [ 33 ] found that reforms, legal, fiscal and intellectual incentives to respect copyright and intellectual property patents encourage the society to make itself more innovative and economically more effective; however, they underline the importance of human capital and investment in people as one of the most important factors for reducing the level of corruption in the country.

There are also theories that corruption can act as the lubricant of the economic wheel and at least in some cases has a positive impact on the economic growth. The empirical analysis done by Dreher and Gassebner [ 34 ] on a sample of 43 countries between 2003 and 2005 shows that corruption is even useful, but with some reservations. In particular, they investigated the short-term effects of corruption and found, for example, that in countries where corruption is widespread, more new entrepreneurs enter the market (corruption in the public sector is expected to promote private entrepreneurial activity). They are, however, not necessarily to succeed, as there is a high likelihood that they will go bankrupt due to the rigid regulations that block the activity and because of which bribes are needed. They do acknowledge, on the other hand, that most authors who have been doing research for a longer period of time admit the harmfulness of corruption both for society and the economy. Something similar show the data for some Asian countries, where, unlike their findings (short-term benefit), the high degree of corruption coincides with the long-term economic growth.

Svendson [ 10 ] also notes that, in light of the theoretical literature and various research studies, notwithstanding that these show the negative impact of corruption on the economic growth, but this cannot be said for sure, since there are difficulties in measuring corruption, and at the same time, the question arises whether the econometric models that were made are good enough to capture all the important variables. He also states that corruption appears in many forms and that there is no reason to assume that all types of corruption are equally harmful to the economic growth.

Recent empirical researches also attest to that; while many countries have suffered, as a characteristic consequence of corruption, the decline in economic growth, other countries have had economic growth (in some cases a very positive one) despite corruption. The latter is also to be expected, since corruption has many manifestations and it would be surprising if all types of corrupt practices had the same effect on economic performance. Analyses show that one of the reasons for this is the extent to which the perpetrators of corrupt practices—in this case the bureaucrats—coordinate their behavior. In the absence of an organized corruption network, each bureaucrat collects bribes for himself, while ignoring the negative impact of others’ demands for them. In the presence of such a network, the collective bureaucracy reduces the total value of the bribe, which results in lower bribe payments and higher innovation, and the economic growth is consequently higher in the latter case than in the former case. The interesting question is not so much why is the degree of corruption in poor countries higher than in the rich ones, but rather why the nature of corruption differs between countries. The extent to which corruption is organized is just one aspect of this, but there are other aspects. For example, it is common practice in some countries to pay ex post (as a share of profit, for example) instead of ex ante (in advance, as a bribe) to officials or politicians, so it is assumed that the effects on the economy will be different. The precise reason why corruption should take on one form and not the other is an important issue which has been largely ignored and which could have to do with cultural, social and political reasons, as well as economic circumstances [ 35 ].

In the fight against corruption, a remarkable role was also played by the debt crisis. The die Welt newspaper [ 36 ] mentions the study of the Hertie School of Governance, which shows that Italy, Spain and Portugal have made great strides in the fight against bribery and corruption of their civil servants due to lack of money, which enabled a significantly more transparent and “pure” practice for the award of public procurement. The crisis is supposed to dry up monetary resources and thus reduce the chances of corruption. Also, the crisis has changed the perception of the society, and bad business practices, which were acceptable before the crisis, are acceptable no longer. However, the fight against corruption is often similar to the fight against windmills. The case of India shows how corruption is changing, getting new dimensions, not only in scope, but also in methods. Just as the population in India is growing, so is corruption, and there are always new ways how to cheat both the state and the society. The perception of corruption is increasing year after year. Despite all the anti-corruption moves and anti-corruption initiatives, people do not hesitate to offer or accept a bribe. The bribers are becoming innovative, they adapt to the situation and the innovation of companies in paying bribes and hiding them is also visible. However, just as elsewhere in the world, the negative effects of corruption are the same; it reduces foreign direct and domestic investments, increases inequality and poverty, raises the number of freeloaders (renters, free-riders) in the economy, distorts and exploits public investments and reduces public revenues.

4. Discussion

Corruption is, in fact, a multidirectional process. On one hand, the provider benefits, on the other the recipient, and both are aware of the deed that remains hidden. The third link in the chain is everyone else, the victims. Although not every act of corruption is yet a criminal offense, it is, however, unethical and detrimental to the economic and political development of a society. Usually, there are persons involved with political, economic and decision-making power, and as the philosopher Karl Popper wrote in his book, The Open Society and its Enemies , that the greatest problem is not the question of who should give orders, but how to control the one who gives them. How to organize the political and social institutions in order to prevent the weak and incompetent rulers from doing too much harm? However, as there is no general and unmistakable way of preventing the tyranny or corruptions of the heavyweights, the price of freedom is eternal alertness [ 37 ]. Greediness, ambition, rapacity and immorality have been known to the human society ever since the emergence of civilization and use every tool available to them: kinship, common past, school contacts, common interests, friendship and, of course, political as well as religious ties.

In a study by Šumah et al. [ 38 ], we did an analysis of countries, taking into account their ranking on the Corruption Perception Index published every year by Transparency International, and identified the main factors affecting the level of corruption in a particular group of countries, or rather, we tried to find similarities and differences between individual groups of countries in terms of what affects the level of corruption in these groups. We have established a basic model of three factors (risk, benefit and consciousness) that was created on the basis of the merger of several known, scientifically proven factors that cause or reduce corruption or affect its level in the individual country. According to this degree of corruption, we have identified five groups, classified the countries and analyzed their common characteristics. The findings were as follows:

Corruption is linked to the level of GDP (the higher the GDP, the lower the rate of corruption).

Corruption is related to the level of education (the higher the average level of education, the lower the level of corruption).

Corruption is strongly linked to the geographical location. The highest level is in Asia (mainly in Central Asia), Africa (North and Central Africa) and South America (according to the Transparency International map).

Corruption is strongly linked to the country’s prevailing religion.

Corruption is linked to freedom in the country (personal freedom, freedom of speech, economic freedom, etc.), with respect to the rule of law in a country and inefficiency of public administration, which is often also locally limited or is inherently corrupt.

The lower the country is ranked, the more dominant is the patriarchal society.

Many researchers are still involved in corruption. The findings show that there is a link between corruption and its negative effects, but from most of the studies it is not possible to determine what the cause is and what the consequence. Whether is the level of corruption lower due to high GDP, or is it vice versa, cannot be directly identified, since the corruption depends on economic indicators, while at the same time affecting them [ 39 ]. It is also very difficult to claim that the average low level of education is due to corruption or, conversely, that corruption is a result of low education. Similarly goes for the rule of law and (in)efficiency of public administration. This interdependence will surely continue to be the subject of numerous researches in the future, for the only way to be successful in the fight against corruption is if we know the causes and begin to eliminate them.

Nevertheless, there remains something that needs to be emphasized. Almost all of the studies ignore the fact that the top of the most corrupt countries consists of countries with one of the various forms of armed conflict (civil war, intertribal conflicts, inter-religious wars or some other form of aggression), which means that peace in the country is a prerequisite for a successful fight against corruption. The least corrupt countries are countries that have a lasting peace on their territory (most since the Second World War or even longer), which is confirmed by the above fact. Peace is therefore one of the prerequisites for a successful fight against corruption.

The answer to the question of how to deal with corruption is not unambiguous; some countries have achieved great success in dealing with it in a relatively short time (Singapore, Estonia and Georgia) and some have been struggling for a long time (the most famous example is Italy). The first condition is in any case to ensure freedom (personal freedom, economic freedom, freedom of speech, freedom of the press, etc.) and democracy, and then education and awareness of people. However, at this point, it is not about introducing the Western type democracy, as our culture knows it, for it has often proven that, especially with the help of the army, more harm than benefit was caused. It is necessary to start using good practices of countries that are similar to each other (religion, habits, tradition, ethics and morality) and that have common history.

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© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution 3.0 License , which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

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Published: 03 October 2018

By Oguzhan Ozcelebi



By Maumita Choudhury



Essay on Effects of Corruption

Students are often asked to write an essay on Effects of Corruption in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on Effects of Corruption


Corruption is an unethical act, where people use power for personal gain. It’s a serious problem that affects societies globally.

Impact on Economy

Corruption hampers economic growth. When public funds are misused, infrastructure and public services suffer, leading to poor quality of life.

Social Effects

Corruption undermines trust in institutions. It creates a society where dishonesty is rewarded, affecting moral values.

Political Consequences

Corruption erodes democratic principles. It can lead to political instability and discourage citizens from participating in democratic processes.

In conclusion, corruption negatively impacts the economy, society, and politics. It’s essential to fight it for a better world.

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250 Words Essay on Effects of Corruption

Corruption, a pervasive and long-standing issue, is a complex phenomenon with adverse socio-economic effects. It undermines democratic institutions, slows economic development, and contributes to governmental instability.

Economic Impact of Corruption

Corruption plays a destructive role in economic development. It hinders the growth of a country by discouraging foreign and domestic investment. Misallocation of resources is another economic effect of corruption, as it leads to inefficient economic outcomes. The fiscal implications are also significant as corruption reduces tax revenues and increases public spending.

Corruption erodes political stability and undermines the rule of law. It leads to a lack of trust in public institutions, which can result in social unrest and political instability. Furthermore, it distorts political decision-making processes, favoring those willing to pay bribes over those who are not.

Social Implications

Corruption also has severe social implications. It exacerbates income inequalities and widens the socio-economic gap. Moreover, it impairs the provision of public services, affecting education, healthcare, and infrastructure, which disproportionately affects the poor and vulnerable.

In conclusion, the effects of corruption are multifaceted and far-reaching, affecting all aspects of society. It is a deterrent to economic, political, and social progress. To mitigate these effects, it is essential to foster a culture of transparency and accountability, promote good governance, and implement stringent anti-corruption measures.

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500 Words Essay on Effects of Corruption

Corruption, a deeply ingrained social malaise, is a complex phenomenon with ramifications extending across political, economic, and social spheres. It is a systemic issue that undermines the fundamental principles of fairness, justice, and the rule of law, impeding societal development and progress.

Political Consequences of Corruption

Corruption has profound implications for the political fabric of a society. It erodes public trust in government institutions and officials, leading to political instability and social unrest. When public office is seen as a means of personal enrichment, the democratic process is compromised, and the legitimacy of the government is called into question. Consequently, corruption can fuel populist movements and political extremism, further destabilizing the political landscape.

On the economic front, corruption acts as a significant deterrent to growth and development. It creates inefficiencies in the allocation of resources, as decisions are influenced by bribery and favoritism, rather than economic rationale. Corruption can deter foreign investments, as it increases the cost and risk of doing business. This lack of investment can stifle innovation, impede infrastructure development, and hinder economic progress. Furthermore, corruption exacerbates income inequality and poverty by diverting public funds away from essential services like education, healthcare, and social welfare.

Social Ramifications of Corruption

The social consequences of corruption are equally damaging. It undermines the social contract between the government and its citizens, leading to disillusionment and apathy. Corruption can also perpetuate social inequality by creating a culture of impunity where the wealthy and powerful are above the law. This culture erodes social cohesion and can lead to increased crime rates and social unrest.

Corruption and Environment

Corruption also has a detrimental impact on the environment. It can lead to the illegal exploitation of natural resources, poor enforcement of environmental regulations, and inadequate responses to environmental crises. This can result in irreversible environmental damage, affecting the health and livelihoods of present and future generations.

In conclusion, the effects of corruption are far-reaching and multifaceted, permeating all aspects of society. It undermines democratic processes, hampers economic development, exacerbates social inequality, and contributes to environmental degradation. Addressing corruption requires a comprehensive approach that includes strengthening institutional integrity, promoting transparency and accountability, and fostering a culture of ethics and integrity. Only through such concerted efforts can we hope to curb the pervasive influence of corruption and create a more equitable, prosperous, and sustainable society.

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