Access Money Corruption

We Indians think of corruption as something that holds us back as a nation. Strike that. Everyone thinks that eliminating corruption would open the road to so much betterment, not just in India but world-over.

 

Which is why I found Yuen Yuen Ang’s interview about her book on corruption and China, China’s Gilded Age, so interesting. As she says:

“The conventional wisdom is that first we eradicate corruption and get good governance, and then we get economic growth. The point I make in this book is that’s not true – that’s a fairy tale!”

Really? Does she said that because China’s economic growth has happened hand in hand with corruption? But could China be a blip, an exception?

“I would say that China is a blip as much as America in the 19th Century or the UK in the 18th Century are blips. In fact these three major superpowers are very similar – what really happened is that corruption went along with capitalism, and was manageable because corruption evolved into sophisticated transactional forms.”

Whoa! Really?

“If you look at the history of the West, corruption was absolutely not eradicated before there was growth. When America was a developing country it was massively corrupt and had rapid economic growth and many parallels with modern China. So China today is a live demonstration of how history really happens.”

 

Of course, there’s fine-print to all this. She says there are 4 types of corruption, which she splits into a 2 x 2 grid/axis. On one axis, she lists who the corruption involves: the elite or the non-elite? On the other axis, she splits it into what it achieves: theft/extortion or a something-for-something transaction? It’s easier to understand the idea with her own picture, with drugs as the item involved:


The corruption involving only theft are like toxic drugs, i.e., they do no good. But if corruption involves exchange, and involves almost everybody, that’s better but still not good. The “best” form of corruption is if it involves exchange and involves only the elite: she calls it “Access Money corruption” (money for access to something). Examples include “cheap loans, subsidies, state backing”. As she says, even this has its downsides (obviously), but for a long time, when a country is still building systems and infrastructure, the benefits outweigh the bad parts.

 

But why/how does Access Money corruption do any good? For one, it aligns the incentives of the politicians, bureaucrats and businessmen. Second, corruption cannot be eliminated overnight, so the practical approach is to “avoid the most growth-damaging forms of corruption and channel it towards Access Money corruption”. And history tells us that once countries become rich, then they always seem to take measures to allow only Access Money corruption. Yes, Access Money corruption exists today even in the West.

 

As I said, it’s a very different take on the whole topic.

Comments

Post a Comment

Popular posts from this blog

Student of the Year

Image
As a toddler, my daughter loved Alia Bhatt’s songs, esp. the ones from Student of the Year . (That movie did have many good songs and well-choreographed dances). Fast forward to present day, when she is 12 yo. She rarely watches Hindi movies now, but one of the few ones she likes of late, Raja aur Rani ki Prem Kahani has, yes, Alia Bhatt.   If I had any hopes that there was anything to be read in the name of her toddler-time favorite ( Student of the Year ), they have been dashed. Our conversations come exam time are perfectly captured by this photo and its caption: In fact, the pic below captures how she and I look at her answer sheets – me intently, she with an expression of “It’s over, so why are you even looking at it?”   Of late, we pull her leg and tell her that she isn’t showing any signs of academic prowess, she’d better find a rich guy to marry. Some time later, she showed us this meme on the Internet: “Me No Study, Me No Care Me Go Marry Millionaire If He Die
Read more

The Retort of the "Luxury Person"

Image
Coming up with biting and witty retorts. It’s something we dream of, but rarely manage to pull off. Worse, the more we stew over the offending remark, the more likely we are to come up with that dream retort, as Calvin ruefully points out: During our last holiday at the Taj Resort, seeing my wife carrying towels to our poolside chairs, one of the kids there mistook her for a member of the staff and asked for a towel. When my wife narrated this to us, I did not imagine that my 8 yo daughter would come up with her own retort. But a day later, my daughter recapped the incident, an incident that didn’t even involve her in the first place , and said, “You know what I’d have told that kid who asked for the towel?”. And without waiting for an answer, she told us anyway: “I don’t work here. I too am a luxury person who is living at this resort. Go get your own towel.” We were highly amused by the phrase she had coined: “luxury person”. It certainly captures the kind of holid
Read more

Animal Senses #7: Touch and Remote Touch

Instinctively, we think touch is based on contact. Not entirely true, explains Ed Yong in Immense World – there’s a more important aspect than contact: “These incredible feats are possible through movement. If you rest a fingertip upon a surface, you can get only a limited idea of its features. But as soon you’re allowed to move, everything changes. Hardness becomes apparent with a press. Textures resolve at a stroke.” As you run your fingers over a surface, they hit the tiny peaks and troughs and set off vibrations in the mechanoreceptors at their tips.   At the tip of its snout, the star-nosed mole has many pairs of hairless appendages. It uses them to touch things around itself. Alive or dead? Food or ignore? It does these movements at an insane speed. In the time it takes to blink our eyes, the star-nosed mole can probe, identify and swallow its food. “Light may be the fastest thing in the universe, but light sensors have their limits, and the star-nosed mole’s sense of
Read more