Corruption as a Drag on Development

Corruption is a worldwide phenomenon manifested in many different forms. Whether it appears as a few bills pressed into the hand of a police officer, as the awarding of a government contract without competition, or as the abuse of public office by accepting kickbacks or stealing from the treasury, corruption is a fact of life. Its economic consequences are also well known. It discourages investment, distorts trade, and increases costs, which, in turn, slows growth and negatively affects development. Politically, corruption erodes trust in institutions, reduces participation, and undermines legitimacy.

Corruption often seems most pervasive in the places that can least afford it: less developed countries. Although corruption has posed a challenge for Latin America since colonial times, the emergence of democratic regimes in the region since the 1980s has brought demands for greater transparency and accountability. Corruption nevertheless remains a problem. Several Latin American countries rank high on the Corruption Perception Index, published annually by Transparency International.

Once largely ignored by academics or treated in an anecdotal fashion because there was no serious methodology to measure it, corruption has become the subject of much scholarly work as various fields recognize its political, economic, and social effects. This interest coincides with the end of cold war, democratization, and economic liberalization. There are also practical reasons as governments, international agencies, nongovernmental organizations, and individuals come to see the financial and human cost not only of corruption itself but also of the perception of corruption. As researchers struggle to document corruption, measure its effects, and find ways to reduce it, they find that it is often difficult to ascribe it to specific historical, economic, and cultural forces and to specific regimes, given that corruption has multiple causes and is rooted in myriad factors.

The five books under review here—three of which focus specifically on Latin America—are the latest testament to this growth in scholarly attention. All offer stimulating approaches and eloquent and incisive discussions.

Until recently, international organizations paid little heed to corruption, in part because countering communism was a more pressing issue than good governance. Now, with the expansion of global markets and the push for economic liberalization, opportunities for corrupt practices have only increased. This is most obvious in the post-Soviet economies in transition (e.g., Russia, Albania, Romania), but many Latin American countries also fit the mold. Under strong criticism for tolerating illegitimate activities that taint government, organizations such as the United Nations, the World Bank, the Inter-American Development Bank, and the Organisation for Economic Co-operation and Development have called attention to the role of corruption in distorting and impeding social and economic development so as to fight it. Aided by such international organizations, citizen groups have formed anticorruption commissions. In addition, international watchdogs such as Transparency International and Latinobarómetro are helping expose and fight corrupt practices by issuing comparisons among countries.

Although the body of literature on corruption has grown rapidly, it is weak on methodology. Identifying and measuring corruption has been a challenge for every discipline to attempt it. But new tools are being developed, thereby allowing researchers to drill down to the microlevel and to consider the scope of public opinion. Since the mid-1990s, the World Bank has led this effort.

Commissioned by the World Bank...