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Corruption: Costs and Mitigating Strategies
Author:
International Monetary Fund. Fiscal Affairs Dept.
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International Monetary Fund. Legal Dept.
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Series:
Staff Discussion Notes
Volume/Issue:
Volume 2016: Issue 005
Language:
English
Publication Date:
11 May 2016
DOI:
https://doi.org/10.5089/9781513594330.006
ISBN:
9781513594330
ISSN:
2617-6750
Pages:
47
Keywords:
SDN; government; country; economic reform; functioning government institution; a number of country; countries rich; government Finance Statistics Manual; Corruption; Governance; Growth; IMF; Institutions; IMF experience; core government function; a number of EU member country; government approval; government decision; IMF research; government regulation; government function; tax authorities; IMF support; Anti-money laundering and combating the financing of terrorism (AML/CFT); Public sector; Financial Sector Assessment Program; Legal support in revenue administration; Global
Legal-disclaimer:
Staff Discussion Notes (SDNs) showcase policy-related analysis and research being developed by IMF staff members and are published to elicit comments and to encourage debate.The views expressed in this Policy Discussion Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy.
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In an environment in which growth and employment prospects in many countries remain subdued and a number of high-profile corruption cases have fueled moral outrage, and amid a growing consensus that corruption can seriously undermine a country’s ability to deliver inclusive economic growth in a number of different areas, addressing corruption globally—in both developed and developing countries—has become increasingly urgent. When corruption impairs government functions, it can adversely affect a number of important determinants of economic performance, including macrofinancial stability, investment, human capital accumulation, and total factor productivity. Moreover, when systemic corruption affects virtually all state functions, distrust of government can become so pervasive that it can lead to violence, civil strife, and conflict, with devastating social and economic implications. This Staff Discussion Note focuses on corruption that arises from the abuse of public office for private gain, whether it manifests itself transactionally (for example, a bribe) or through powerful networks between business and government that effectively result in the privatization of public policy. While designing and implementing an anticorruption strategy requires change on many different levels, the IMF's experience in assisting member countries suggests that several elements need to be given priority: transparency, rule of law, and economic reform policies designed to eliminate excessive regulation. Perhaps most important, however, addressing corruption requires building effective institutions, with the clear objective of developing a competent civil service that takes pride in being independent of both private influence and public interference.
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Cover Staff Discussion Notes
Staff Discussion Notes
ISSN:
2617-6750
Publisher:
International Monetary Fund