This essay contends that corruption is both a cause and effect of poverty in developing countries. The following broad observations are discussed in greater detail in this essay:
• Corruption is a cause of poverty as it diverts public resources (financial, social and political resources) into private hands, which rob the citizens of their economical, social and political rights.
• Corruption is an effect of poverty, since poverty is a prime breeding ground for systematic corruption. Moreover, poverty acts as an impediment to the fight against corruption.
• Corruption can only be combated by recognizing the nexus between poverty and corruption.
In order to understand the nexus between corruption and poverty, it is important to consider the definitions of corruption and poverty.
Corruption is the use/misuse of public office for private gain, including but not limited to embezzlement, bribery, nepotism, fraud, extortion and influence peddling (Chetwynd, Chetwynd & Spector, 2003). Corruption can arise in political and bureaucratic offices of a nation, ranging from disorganized petty corruption to organized large-scale corruption (Lough, 2008).
Current definition of poverty extends beyond the GDP (Gross Domestic Product) and PPP (Purchasing Power Parity) paradigm, and now takes on a multi-dimensional view. In this arena, poverty is characterized by the lack of social, economical and political rights and institutions. This aspect of poverty is further supported by TI’s (Transparency International) Working paper 02/2008, which considers poverty as a state characterized by the lack of access to basic public services such as health, education, sanitation, basic civil rights, lack of development and disempowerment.
The poverty-corruption nexus
Corruption leads to income inequality between the elite ruling class (including the public service), and the poor by diverting public resources in...