Nova workboard

a blog from young economists at Nova SBE

Paradoxes In Developing Countries

Bureaucratic Accountability & Effective Corruption

Political accountability, a trending fashion in the world politics, has not yet come to fruition despite attempts at holding politicians responsible and fighting corruption throughout developing countries. All over the world, the implementation of responsibility has brought a lot of contradictions. Ironically, one of the most noted contradictions is the U.S. Capitol building, a major symbol of freedom in America. Built by slave labour, the U.S. Capitol was constructed by the very process of which it does not represent.

Paradoxes are found in various studies about the public sector in developing countries but they have a common assumption; Corruption and low levels of representativeness in the government directly undermine the social contract.

According to a report by World Bank (2012), developing countries are facing difficulties related with their institutions. In general, the developing countries’ public sector is inefficient, over-staffed and confused by a complex net of legal frameworks. The report mentioned paradoxes as the inverse relationship between responsibility and authority and the fact that competent and efficient employees tend to perform easier jobs. Also suggested the tendency for short tenures in higher hierarchical positions and the fragile institutional memory that reproduces mistakes.

From a research point of view, it is really interesting to analyse how developing countries can fight corrupt practices and introduce accountable systems promoting institutional transparency. As a result, countries will learn how to combat discretionary decisions and to avoid external influences such as interest groups leading to further or increased continuous corrupt choices in the public sector.

In spite of benevolent intents beyond accountable reforms, bureaucracy may not be the best response because it has adverse results in inefficient institutions. This is the Paradox of Bureaucratic Accountability, studied by Shamsul Haque who proved that it brings corruptive incentives.

The main problem is that in developing countries, corruption may be an efficient response to a bureaucratic accountability system. There’s a lot of literature about this strange concept of efficient corruption (see the paper by Pierre-Guillaume Meon and Laurent Weill), nevertheless, it can be easily explained: If a country has a complex and bureaucratic system, corruptive practices can be the only way to make decisions happen. Even though it undermines the credibility of governments, corruption may increase the social welfare by comparison with normal procedures.

Question: If bureaucratic accountability in developing countries creates corruptive incentives, how then can we promote transparency and avoid discretionary decisions in developing public sectors?


By Dino Alves

Author: studentnovasbe

Master student in Nova Sbe

Comments are closed.