What is development’s public enemy number 1?

“Every dollar that a corrupt official or a corrupt business person puts in their pocket is a dollar stolen from a pregnant woman who needs health care,” Kim said during a panel.

“In the developing world, corruption is public enemy No. 1.”

That is the head of the World Bank saying things that don’t make sense to me. Hat tip to @kopalo.

Corruption is a big problem. But I would say it is closer to enemy number 12 than number 1. Here is why.

To be fair, if I were World Bank president, probably my smartest political move would be to go to a conference every week on a different X and tell them that X is public enemy number 1, and then bask in their self-congratulatory applause.

Seriously, I’d like to hear the argument that corruption is more detrimental to development than civil wars, HIV/AIDS, coups, over-centralization of Presidential power and the absence of public accountability, and possibly the dearth of secondary and tertiary education, or absence of credit and insurance markets. And on and on.

As impossible as any of these things are to fix, they could well be more straightforward for the Bank than fixing corruption.

If I had to pick the one way that Kim could put dollars into the pockets of a pregnant woman who needs health care tomorrow, I have a suggestion.

Yes, corruption hurts far more people, but Kim has even more leverage over that than corruption, so the impact of his actions on human welfare would probably be greater.

 

3 thoughts on “What is development’s public enemy number 1?

  1. I think it’s important, when discussing corruption, to define exactly what we are referring to. Although I haven’t looked through the research as carefully as you have, I would expect that the different types of problems within corruption, governance, and public accountability would each have considerably different impacts on development. Petty corruption, higher-level graft, weak government oversight systems, the impact of patronage politics on reducing incentives to invest in public goods, and the development of inclusive and accountable political institutions – I imagine that each has widely different implications for development. However, I think it is easy, especially for people who are not heavily involved in development, to conflate elements of each of these under the umbrella notion of “corruption.” Could you write a post or a response defining specifically what you are referring to when you argue that corruption should not be a top priority (ex. do you only mean petty corruption, or do you draw the line further out?) and discussing which aspects of governance, institutional quality, and public accountability (many of which are likely interact with corruption and patronage systems) are more critical for development?

  2. Chris – you are exactly right in your instinct. Dr. Kim has been going to a conference every week on a different X and telling them that X is so important. Earlier in December he was in Japan talking about how Universal Health Coverage is so vital. Contrast that the talk he gave at a private equity conference back in October where we needed private equity funds on board if we were going to be successful in development. And the same went for speeches on energy, jobs, fragility, education, etc, etc.

    He is a political operator, his biggest shareholder is the US. His biggest contributors to IDA are the US and UK – so the Anglo-American fetish with corruption has to be his. But only in public perception however. I’ve been hearing rumours (impossible to substantiate at this point) that the Bank’s anti-corruption wing (INT) is changing strategy to focus resources on fewer higher profile large corruption cases (like Padma bridge in Bangladesh where the Bank publicly pulls out and gets big headlines for its zero-tolerance approach), whil downscaling work on the more numerous smaller cases.

    Along Daniel’s lines above – I would love to see more nuance about different kinds of corruption. And a better recognition that Western legalised practices of corruption (corporate campaign contributions in exchange for legislative favours) may not in outcome by much different than the crony capitalist systems operating in developing countries.

    If the Bank wanted to make a push on corruption – how about against undue preference in senior appointments?? Or might that hit too close to home for the 12th American male World Bank president in a row??

  3. Chris – I agree with you that corruption should probably not be the WB’s priority, but (as the other comments say) if you give corruption a wide enough definition (Transparency international gives “the abuse of entrusted power for private gain”), then it is reasonable to say this is pretty high on the public enemy list. Indeed, look at your list – would there be as many coups and civil wars if the winners were prevented from pocketing any public money? Why would over-centralisation of presidential power be a problem if the president was benevolent? And can’t we blame a significant portion of government’s inability to provide healthcare/education/market regulation on the misuse of power by those entrusted to provide such services?