Corruption and Economic Growth Essay - 1383 Words

Corruption and Economic Growth This brief overview analyzes corruption and its relationship to economic growth. The brief continues to consider the idea of economist Amartya Sen that development means more than economic growth. Additionally, provided, a quick risk analysis of two countries where corruption is common everyday practice. Corruption and Economic Growth Relationship What is the relationship between corruption in a country and economic growth? Answer this question. Research indicates corruption weakens an economy. Ho (2001) contends there is a direct relationship between corruption and economic growth (pg. 67). Ho further states â€Å"a 1% increase in the corruption level reduces the growth rate by about 0.72% or,†¦show more content†¦Freedom is a right we have and enjoy very much in the United States. In order to have freedom, governments must have laws to support freedom, additionally; governments must embrace freedom in order to allow growth. Development Do you think Sen is correct that development is about more than just economic development? Explain. Merriam Webster (economic) defines economic: relating to, or based on the production, distribution, and consumption of goods and services (2011). Growth is not possible without raising a person’s standard of living. In order to increase this standard, education must also increase. Education depends on schools, educators, and buildings. Agreeing with Sen, development is more than just economic development; it is a continuous cycle. Risk and Investment You are the CEO of a company that has to choose between making a $100 million investment in Russia or the Czech Republic. Both investments promise the same long-run return, so your choice is driven by risk considerations. Assess the various risks of doing business in each of these nations. Which investment would you favor and why? Risks of doing Business Risks are in every country and every business; as an investor or business executive, a person must figure out how to mitigate the risks and earn a profit. Doing business in Russia or the Czech Republic is not any different. A risk assessment has to be completed. Both countries create unique concerns. Russia. ConductingShow MoreRelatedCorruption And Its Effect On Economic Growth1487 Words   |  6 Pagesagainst theories that propose that corruption may be beneficial to economic growth by presenting theoretical and empirical evidence that suggest otherwise. I will also discuss policies that will prove effective in eliminating corruption in developing countries. The international handbook on the economics of corruption defines corruption as the use of public resources to fund the private purposes. It usually involves the abuse of official power. Economic growth can be defined as increase in a country’sRead MoreThe Effects Of Corruption On Economic Growth1444 Words   |  6 Pagesagainst theories that propose that corruption may be beneficial to economic growth by presenting theoretical and empirical evidence that suggest otherwise. I will also discuss policies that will prove effective in eliminating corruption in developing countries. The international handbook on the economics of corruption defines corruption as the use of public resources to fund the private purposes. It usually involves the abuse of official power. Economic growth can be defined as an increase inRead MoreEffects Of Corruption On Economic Growth1753 Words   |  8 PagesCorruption has been seen as a major obstacle of rapid economic growth and development. It is a complex phenomenon whose roots lay in political and bureaucratic institutions and affects the economic growth of different countries. It makes the governments intervene where they do not need to, and it weakens the ability of the government to enact and implement policies in areas in which government intervention is needed. Over the years, the dispute of the economic consequences of corruption on economicRead MoreHow Corruption Has Proven Detrimental Effect On Business And Economic Growth1534 Words   |  7 Pagesand Ross (Corruption entrepreneurship) study, the effects of cor ruption on the number of establishments in any given municipality have proven to be negative and statistically significant. Over time, corruption has proven to be detrimental to business and economic growth and has long lasting negative effects (entrepernerushipbrazilmuncipalities, 69). Business growth slows or stops all together and only the state owned enterprises are able to persist through an economy riddled with corruption. These stateRead MoreA Research Based On A Cross Country Data Essay1216 Words   |  5 PagesMauro (1995) conducted a research based on a cross-country data to evaluate causes of corruption worldwide. In â€Å"Corruption and Growth†, he describes the relationship between corruption and economic growth of different countries over the period 1971-1979 and 1980-1983. In his research, Mauro used indices related to corruption from Business International Corporation which sells indices to banks, companies, and investors. The indices are based on the respons es of the BI’s analysts from more than 70Read MoreCorruption Is Defined As The Appropriation Of Public Resources1549 Words   |  7 PagesCorruption is defined as the appropriation of public resources for private profit and other private purposes through the use and abuse of official power or influence (Smith, S, C and Todaro, M, P, 2012, P.546). Examples of how governments do this can be through collecting bribes for providing permits and licenses, for giving passage through customs or for prohibiting the entry of competitors (Shleifer, A and Vishny, R,W, 1993, P.599). Corruption varies across different economies, which we will analyseRead MoreCorruption in Indonesia946 Words   |  4 PagesCulture of corruption is deeply entrenched in Indonesian society and remains an ongoing challenge for Indonesia (Temple, 2001). Under Suharto’s regime, corruption was centralized in which the collection of bribes was dominated by government (Macintyre, 2003). In other words, indi vidual officials were prohibited to maximize their personal gains (Temple, 2001). After the Suharto’s fall, Indonesia became more democratic and decentralized which were likely to confront corruption. However, corruption has gottenRead MoreThe Causes Of The Overwhelming Civil War In Syria1183 Words   |  5 Pagescountries in the world. The crisis wakes the interest among researchers and induces them to take a close look at the effect of the crisis on the economic growth in Lebanon. Theoretical literature reviews. 1) Tourism: For Faysal Itani (2016) Lebanon tourism pays the price of the Syria’s war. It threatens the economic growth of the country. †¢ Several foreign countries (US, UK, Canada) place bans, formal or informal, on travel to Lebanon due to security incidentsRead MorePublic Debt And Political Changes Essay1517 Words   |  7 Pages10 shows that, the sharp decline in the rate of economic growth occurred in 2011, the most reasonable explanation for that is the occurrence of 25th of January revolution. This low rate of economic growth continues during period of political instability below its potential growth rate, and it began to improve only after the 30th of June revolution and the partial regaining ofpolitical stability after presidential election in 2014. With economic growth rates that are below their potential rates it wasRead MoreCorruption Of Corruption And Corruption1445 Words   |  6 Pagesfunction today? Why has corruption not constantly and consistently fallen and proved to be an inadequate way to rule? The role of corruption in today’s countries has proven to be weak, yet has held as a way of life for many around the world. As money and greed increase worldwide, the desire for these things increases as well. Learning what works, and what doesn’t is essential to the upkeep of many countries and their well-being. Does the increase of the amount of corruption in a country decrease the