The impact of corruption on the development of a country
Most of the third world countries are some of the countries, which are endowed will raw materials and minerals than the developed country, however, the citizens of these countries are living bellow the poverty line, while 75% if their populations depend on les than US$1 per day. According to Kiltgaard, (86), corruption is the legal activity through which people in senior position solicit for bribes in order to deliver his service. These people are bent on using the public offices with abandon for their own gains.
However, according to Vogl, (107), corruption is like gangrene or cancerous growth that once started, is not easy to excise. The main challenge that anticorruption czars have is in determination of the root of corruption.
According to Kiltgaard, (98), corruption varies in forms, for example, cases like bribery where people give something in return for a favor, extortion, mismanagement of public funds and nepotism are some of the traditional for of corruption. The se are experienced worldwide. However, argues that corruption has taken new form that makes it hard for anybody to know whether one is engaging in corrupt practice. Examples are influence peddling, appropriation of the exchequers money for personal gain and cronyism
Corruption amongst two parties are the most common type of corruption and the do not have a clear patter of arising. Gray, Cheryl & Kaufmann, (112) argues that corruption is mainly concentrated in the awards of government contracts. In government contracts, the procurement manager awards the contract to their relatives or close relatives. They may also award the contracts to their friends who are contractors for some fee or stipend.
Government benefits:
At times people use bribes to influence the allocation of relief materials and food. Monetary benefits may also be allocated according to the desire of the corrupt officers, for example, credit subsidies and price regulations may be allocated to some sectors or regions that the corrupt officers favor. On the other hand, argues that people use bribes to gain access to certain privileges and preferential treatment, which they could not find in normal circumstances
Government revenue:
There are cases in which people use bribes to influences the way government revenue is collected and distributed. For example, argues that most people get access to public utilities and even get a waiver on the fees charged for using public utilities
Regulatory avoidance
While people use bribes to oil the palms of the corrupt officials to get faster service and preferential treatment, they can slo be used to avoid regulatory practices, Hussein (36) enthuses that bribes can turn the wheel of bureaucracy and their application. Regulatory measures are put in place to ensure equitable distributing and control of process and procedures, therefore people consider these regulations as bureaucracy. To evade bureaucracy, they bribe the people in charge.
SUMMARY OUTPUT
Regression Statistics
Multiple R 0.996
R Square 0.993 Goodness of Fit >= 0.80
Adjusted R Square 0.986
Standard Error 2.010
Observations 3
ANOVA
df SS MS F P-value
Regression 1 568.6246418 568.6246418 140.6781664 0.054
Residual 1 4.042024833 4.042024833
Total 2 572.6666667
Coefficients Standard Error t Stat P-value Lower 95%
Intercept 7.035339064 3.115983451 2.257822987 0.265 -32.55698462
Data1 0.902578797 0.076097743 11.8607827 0.054 -0.064334709
y = 7.035 +0.903*Data1
Confidence Level
0.95 0.99
Upper 95% Lower 99% Upper 99%
46.62766275 -191.318 205.3887
1.869492302 -3.94156 5.746713
Conclusion
While corruption has a negative impact on the development of most country, the citizens are the ones who are mostly affected by corruption because most of the essential services are diverted to other areas. This act of diversion of the products that are supposed to relief services and government benefits to people but only a few benefits from that service. Generally, corruption is a social, legal and political ill that should not be part of our lives because at this rate, things are changing and soon, the people will internalize the comment.
Works cited
Alatas, Hussein S. Corruption and the Destiny of Asia (Singapore, Simon and Schuster (Asia) Pte. Ltd (1999)
Gray, Cheryl W. and Daniel Kaufmann, 1998. “Corruption and development”, in IMF/World Bank, Finance and Development, 35(1): 7.
Kiltgaard, Robert, 1998. “International cooperation co-operation against corruption”, IMF/World Bank, Finance and Development, 35(1): 3.
Vogl, Frank, (1998). “The supply side of global bribery”, IMF/World Bank, Finance and Development, 35(2): 31
World Bank, (1998). World Development Report 1998 (New York, Oxford University Press); pp. 190-191.
Research Paper on Corruption and Economic Growth
Paper 2
Your research paper is composed of five parts:
• Statement of the issue being analyzed
• Literature review
• Statement of the hypothesis to be tested (e.g., There is a negative correlation between life expectancy and corruption as shown in the sample linear regression model:
Life expectancy = α – β(Corruption Perceptions Index), where β ≠ 0)
• Testing of the hypothesis (e.g., gather data and run regression)
• Draw a conclusion – what does your analysis say about the answer to the question?
You will be examining corruption, which is a major presence in many countries. Whether inherited from earlier regimes or initiated anew, corruption can influence the path of economic development. This paper seeks to quantitatively examine this relationship.
First:
Corruption is Develop a theory of corruption and economic development. That is, state the issue that you will be analyzing and why it is important. You must address how corruption impacts a nation’s economic development or socio-economic status. Use at least four references, but do not plagiarize. State in your own words what the authors are saying about the topic. Make sure to cite these correctly in your paper. Two good sources of information are Transparency International and the World Bank.
Second: Select a characteristic of a country that reflects economic development and can be measured empirically (e.g., percent of the population in poverty, FDI, incidence of disease, etc.). This is your dependent variable. The United Nations Human Development Report(HDR) provides empirical measures of a number of social and economic characteristics that can be used to distinguish the lesser from the more developed economies of the world. You may use any other source, but check with me first and make sure you provide a reference! Nationmaster.com is another good data source.
Third: Using the HDR Tables, (http://hdr.undp.org/en/statistics/) pick (ideally by random sample, if so inclined) 10 high, 10 middle, and 10 low“human development” countries in order to incorporate some variability. Notice that the website lists the rankings in three columns. These can serve as the high, middle and low-ranked countries. Then find the corresponding measure (indicator) of development that you selected for each of these 30 countries.
Then find the countries’ corruption perceptions index (CPI) from http://www.transparency.org/policy_research/surveys_indices/cpi/2008
(Transparency International). This is your independent variable. You are using corruption to explain variation in your dependent variable.
Be aware that the Corruption Index gives less corrupt countries higher values. Convert the CPI score by subtracting it from 10. For example, Sweden would be 0.7, Finland 1.0, the United States 2.7, and Haiti 8.6. This results in lower scores implying less corruption and higher scores implying more corruption, making interpretation more intuitive. You must convert the CPI data!!!!!
Fourth: Construct a table in Excel that shows your selected measure for each country in one Column and the respective PCI score in the next Column. Place the country name in the first column.
Fifth: State your hypothesis. This must be a statement of how you think corruption is related to the “characteristic” you selected. Then, estimate a regression model:
(Your measure) = + 1(CPI)
Create a scatter plot graph of the data with appropriate labels. You can use Excel chart wizard for this.
Sixth: Analyze your regression results (including the appropriate t-statistics and the p-values for the slope (), and R-square). Interpret your statistical results; i.e., what do the results mean? It is not enough to merely report the values of the statistics or even the presence of statistical significance. What do the results tell you about the relationship between the variables? Indicate if your results are what you expected. Do your findings support or contradict the research literature you cite? The text of the paper should be no longer than one page (10 or 12 point font and excluding the data table, the graph and the regression results).
Seventh: Select three additional countries not included in the regression model—one high, one medium and one low. Using the regression model, compare the estimated the value of the dependent variable with the actual value, given the PCI value. Is there a pattern here?
Order of Submission:
First Page: The paper with your theory, literature review, analysis and interpretation.
Second Page: The regression output at the top; then the scatter plot graph underneath; then a table comparing the observed and expected values of your dependent variable for the three extra countries.
Third Page: Your base data for your 30 countries.
Note: Variables may be “scaled.” For example, if the dependent variable is a “large” absolute value ($30,000, 950 widgets, etc.) convert it into a value of a corresponding size by changing $30,000 to 3.0 thousands or by using logs.
* Also: no email submissions and no late papers are permitted. And, you are NOT to ask a faculty member for assistance regarding the statistical procedures.
*Extra credit* (10 pts max)
Select a second variable and run a multiple regression analysis. Put your write-up and the regression output printout on a separate page after your base data page. Think carefully about the additional variable, its meaning and its contribution here. Simply adding another variable does not constitute analysis. Be careful–a high degree of multicollinearity will cost you points!
