Can corruption and economic crime be controlled in developing countries and if so, is it cost‐effective?
| Date | 09 May 2008 |
| Published date | 09 May 2008 |
| Pages | 223-233 |
| DOI | https://doi.org/10.1108/13590790810866917 |
| Author | Gerasimova Ksenia |
| Subject Matter | Accounting & finance |
Can corruption and economic
crime be controlled in developing
countries and if so, is it
cost-effective?
Gerasimova Ksenia
Cambridge University, Cambridge, UK
Abstract
Purpose – The aim of this paper is to assess international efforts in combating corruption and their
implications for developing countries. The paper discusses the globalized character of corruption in
the modern world together with methods applicable to combat the problem.
Design/methodology/approach – The investigation is structured at two levels: the policies are
studied at the organizational level and by sector, by looking at money laundering and bribery – two
economic crimes that are widespread in the developing world. This identifies major trends in the
international instruments to combat corruption and assess their efficiency. The main method is
cost-benefit analysis.
Findings – The findings of this paper are: initially positive ideas of enhancing control and prosecution
of economic crime are not bringing the expected results. The criminal law enforcement approach chosen
by the main international organizations – UN, World Bank, and EU – is not effective.
Practical implications – Until the approach of the international organizations changes and the
priority is given to the principle of prevention rather than punishment, the costs of controlling
economic crimes in the developing countries are unnecessarily high and not worthwhile.
Originality/value – Although the findings sound quite criticizing, they provide insights to possible
amendments to the policies implemented.
Keywords Corruption, Crimes,Developing countries, Globalization, Money laundering
Paper type Viewpoint
Introduction
Corruption is a universal problem, and according to Transparency International (TI,
2006, p. 119) it affects all sectors of society “from construction (France), education
(Uganda), police (Malaysia), to parliament (Japan), the judiciary (Brazil, Burkina Faso,
Ecuador, Israel and Nepal) and even Church (Greece).” There is a general perception
that development leads to lower rates of corruption. A comparison of the Globalization
Index with the Corruption Perceptions Index, criteria developed by the TI, shows it is
widely known that those countries integrated most deeply into the world market have
developed political, social and legal institutions deterring corruption (TI, 2001, p. 287).
In the list for 2006, the three least-corrupt countries are from the developed world –
Iceland, Finland, and New Zealand, while the three most corrupt countries are
developing countries – Turkmenistan, Bangladesh, and Chad are developing countries
(TI, 2006, p. 298). Thus, it is logical to assume that developing countries are
particularly vulnerable to corruption.
First,let me define corruption as a concept.A generaldefinition of corruption wouldbe:
[...] an individual or a group is guilty of corruption if they accept money or money’s worth for
doing something that he is under a duty to do anyway, that he is under a duty not to do, or to
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1359-0790.htm
Corruption and
economic crime
223
Journal of Financial Crime
Vol. 15 No. 2, 2008
pp. 223-233
qEmerald Group Publishing Limited
1359-0790
DOI 10.1108/13590790810866917
To continue reading
Request your trial