One of the most debilitating factors in economic development is corruption. Corruption not only soaks up the efficient allocation of resources, but also shrinks investment horizons to near zero. Why invest in education for your family or children if corruption means jobs are not based on merit. Why invest in building a home or business if they can be taken. Endemic corruption and poverty go hand in hand. For some reason I have a strong visceral reaction to corruption, something about the Iowan in me.
Having traveled a bit and spent time in the 3rd world, I have witnessed the costs direct and indirect of corruption. I studied economic development in university as a focus of my anthropology degree. Here is a good academic papers on how corruption impacts people far beyond the bribe paid. Here is one involving roads from the IMF.
Many assume corruption to be a 3rd world or poor phenomenon. It isn't. Here is a list of countries ranked from the very credible Transparency International Survey. The US made it to 19th place this year as the least corrupt place.
Studying economic development is important. The US is currently undergoing massive Economic Stimulus across sectors and industries yet, I have yet to hear of a single case of reaching into development studies that may offer lessons as to what works or doesn't.
Corruption costs big time. Land use, and registration is one of the things that gets hindered by corruption and is a point of interest for me. It is a $9.9 trillion problem mostly affecting the developing world.
The Good News is Feedback
Better process design and feedback loops typically resolve corruption. Investigative journalism, public feedback, freedom of information acts etc. all aid in this. These tools if available and functioning are effective unless corruption goes to the top of the political structure.
The bad news is that if corruption goes all the way up, as in Russia it won't go away until leadership changes.
Here is a video highlighting the nature of Russia's problem. Poverty and corruption are highly correlated. Although a specious argument Russian male life expectancy of 59 years which puts it at #182 out of 227 countries is probably not helped by the issue. Corruption and its economic burdens costs the average Russian citizen a lot.
So what can You do with your spare time to help out.
Check out these websites and see if there is something you could do. If you have spare time and skills this would look pretty sharp on a resume. Creating tools that make things better is pretty powerful stuff.
These are US sites, but a quick google search should bring up other projects in various countries and regions:
- Sunlight Labs
- Expert Labs
- Property law wiki (just an idea at this point from me)
It is starting to work in the developing world.
Here is a video from TED about a person who wants make a business out of fighting corruption. The positive externalities from this would huge.
