Poverty and Corruption

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Royal University of Phnom Penh Institute of Foreign Languages Department of International Studies

Critical Literature Review

Corruption and Poverty

By Chea Vimean, Khun Chankanha, Mao Monivann

Research in International Studies ISP A3.1 Instructor: Sopha Ratana

May 18, 2012

Corruption and Poverty A3.1 CONTENT Introduction……………………………………………………………………………………………………………………….03 Defining Corruption……………………………………………………………………………………………………………04 Defining Poverty ………………………………………………………………………………..………………….………….05 Relationship between Poverty and Corruption ……………………………….………………………………….06 Conclusion………………………………………………………………………………………………………………………….09 References………………………………………………………………………………….........................................10

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Corruption and Poverty A3.1 Introduction Corruption is commonly accepted as the main factor causing poverty. Poverty and corruption are widely believed as closely related. Most popular beliefs suggest that corruption is the biggest obstacle for a country struggling for political, economic and social change in search for socio-economic development. The impacts on investment, growth, expenditure and economic distribution have been studied by many researchers to investigate the efficient implications of corruption. A number of studies have been conducted to examine the relationship between poverty and corruption trying to identify the way that poverty and corruption really interact, bring about the awareness of the effects on politics, society, and economy produced by the corruption, and the strategies to fight against corruption as the integrated part for poverty reduction. However, this literature review aims to examine various studies on the linkage between corruption and poverty in order to answer the question “Is Corruption the biggest Problem of poverty? This literature review will help enhance more understanding on the nature of corruption and the way that it is linked to poverty. In addition, this topic is worth doing literature review as the issue of poverty and corruption is under the hot debate for the researcher and policy makers. The work will be divided into two parts. The first part will discuss the way that poverty and corruption are defined in the literature. The last part will go through critical review on the relationship between poverty and corruption.

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Corruption and Poverty A3.1 Corruption Generally, corruption is both major cause and a result of poverty around the world. It exists at all levels in society including local and national governments, judiciary functions, civil society, large and small businesses, military and other services and so on. Generally, corruption is literally secretive in nature thus difficult to define and measure. Generally corruption can be divided into three forms namely petty corruption, looting corruption and grant corruption. ("The link between," 2000) Petty corruption involves small-scale practice of corruption. For example people pay a little bribe to custom officials to ignore some goods tax or get goods cleared quickly. It also involves extortion such as paying police officers to avoid fines or punishments (Fujikawa, 2012). Grand Corruption, refer to large sums of money involved. It mostly involves

businessmen and high-ranking government officials whom the figures involved are so significant. Unlike, looting corruption is described by some commentators as the delinquency of economy. Usually it involves the kind of scams whose figures are so large that can have negative implications on macro-economy such as causing banks to collapse, inflation to rise, and the exchange rate to decline ("The link between," 2000). For example, a road is to build worth 2 million dollars but the government officials have already taken 1 million dollar from road construction. As a result, while corruption is defined differently as it has no uniform impact on human societies, scholars who study corruption have tried to find ways to minimize...
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