Wednesday 20 April 2016

Corruption destroyer of GDP and Ecosystem

You may ask, am I serious? Can corruption destroy Earth? Oh yeah! Corruption in any form, in any part of the world, has first and foremost a serious impact on our Eco-system. Why do we need to pay bribes?

  1. To create more industrial corridors and emit more poisonous gases. Isn't Carbon credit a form of bribe? It is like failing in an examination and purchasing marks from your friends so that you can pass the examination. In this case, purchase is being made, using Public money!
  2. To get something cleared from Government officials. Say for example, Passport verification or Licence examination. You're increasing their social status by illicitly increasing their income. These officials, if they spend on purchasing Goods and Services, they are creating a demand which isn't  natural. This has problem in three folds:

    1. The demand created by summation of all such corrupt officers is significant and will create a bubble
    2. If these officers decide to hide this unaccounted money, these notes will go mutilated, imagine the amount of Paper which needs to be used for printing currency and the amount a country has to spend on printing. You may curb Black money by removing particular series of notes from your economy. This doesn't solve the ecological problem. Who is answerable to all those trees which were fell to make these notes? coal burnt to keep the press running?
      To met this artificial demand, arising out of corruption, companies will have to produce more Goods and Services, which translates to nothing but more Pollution
    3. With that in mind, the real GDP of any country should be

      Real GDP = GDP - % of level of corruption in that country
      For example, lets say GDP of country 'S' is 10. If we can estimate that level of Corruption is 3. Real GDP is 7.
      This % of corruption should be used to arrive at the real demand too
    4. Look at the level of Corruption across the world. Now, are the GDP figures realistic? (Image source: transparency.org)

          http://www.transparency.org/cpi2015 
    5. The above image shows, Five of 10 most Corrupt countries also rank among the 10 least peaceful places in the world
  3. As the level of corruption increases, there is ample scope for humans to destroy wild life, fell more trees, increase in dust and pollution
  4. Corruption not only increases the income illicitly, but also increases the luxurious needs. This robs an opportunity for the resources to be efficiently utilized. For example, a dishonest officer, earns more, and buys a luxury car, his need to purchase a car is not only dubious, but the GDP he created through the purchase of the car and also for its maintenance should not be accounted for as the purchase in itself is illegal and the most precious natural resource, 'Fuel' is not efficiently utilized.
  5. According to transparency.org, BRICP nations and their overall rank amongst 168 nations are, Brazil - 76, Russia - 119, India - 76, China - 83 and Pakistan - 117. With some of the most populous countries having such low scores isn't a good news isn't it?
So, its an urge to all the readers, please do not accept or pay bribes.
(images are not owned by the Author. They are used only for representational purposes. Images downloaded from: http://www.transparency.org/cpi2015)

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