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The Comparison of Corruption and Entrepreneurship

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The Comparison of Corruption and Entrepreneurship

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It is generally considered that the corruption rate in the high trusted societies is lower than that is in the low trusted societies. In this paper, this consideration could only be true only for the generalized trust situation. If the generalized trust in an institution and individuals is higher, the corruption becomes lower. However, the trust in a specific person and situation which is known as particularized trust has also been studied in the paper. In this situation, if the particularized trust is higher, the corruption will also be higher.

The particularized trust such as trust in friends and family in this comparison is defined as the negative trust which positively affects the corruption. And the possibility of self-employed individuals involved in the corrupt activities would be increased. The particularized trust of the entrepreneurs towards the governmental officials shows positive impacts for the corruption. In the society where the generalized trust is at relatively low level, highly trusted relationships may also be formed between the self-employed individuals and the fiends or governmental officials, which positively affects the corruption.

According to Vito Tanzi, corruption has been defined as the behaviour that intentionally non-compliance with the arm’s-length principle so that the advantage for someone or the related individuals could be derived(Boris Begovic, 2005). Because it in various contexts and functions with multiple causes and effects, it is considered as a complex phenomenon which ranged from an illegal payment to an endemic economic system (Jens Chr. Andvig and Odd-HelgeFjeldstad, 2000). The corruption problem could be caused either by the economic and political structure or by the culture and moral problem of individuals and could be deeply impacted by the economy system in both mature and emerging economies.

In order to analysis the root causes of the corruption, this phenomenon needs to be...

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