Greed And Corruption Essay

Effects of Greed, Uneven Distribution of Incomeand Inflation on Corruption

Introduction

The Oxford Advanced Learner’s Dictionary (2000) defines Corruption as: (a) dishonest or illegal behavior, especially of people in authority (b) the act or effect of making somebody change from moral to immoral standards of behavior. According to this definition, corruption includes three important elements, morality, behaviour, and authority [Seldadyo and Haan, 2006]. In the words of Gould (1991), corruption is, “an immoral and unethical phenomenon that contains a set of moral aberrations from moral standards of society, causing loss of respect for and confidence in duly constituted authority”. Corruption has been a very long standing and grave issue since the beginning of mankind. Unfortunately, this is one area where research has lagged policy. Research on corruption faces two important obstacles one empirical and one theoretical. On the empirical side, the primary challenge is measurement. Corruption, by its very nature, is illicit and secretive. How does one study something that is defined in part by the fact that individuals go to great lengths to hide it? How does one deal with the fact that attempts to measure corruption may cause the actors

This paper examines 70 economic and non economic determinants of corruption using Factor Anlaysis technique. On the basis of current determinants further 5 new determinants have been generated. Through the use of Extreme Bound Analysis the paper examines the robustness of the existing and the new 5 determinants. The paper then tells about the problems faced during the research, mostly data was missing and since there were huge number of variables interdependency caused problem of multicollinearity. And concludes that the one of the newly generated variable namely, regulatory capacity has a strong impact on the perceived level of