We know the development of present civilization based on Capital Economy. Capital economy is a system of profit against investment amount that is capital. An investor tries to gain best profit that means no-limit. Then the investor will do possible all steps to gain most. So far, it is not 'Corruption'. An investor can buy a village, a town, a city as per law is not corruption. Even the unaccountable accumulation of money of this investor is not a crime as per rule. Then, where is corruption? And, if there is not corruption; then why is the cry of 'Anti-corruption' laws etc.?
Dear Bhowmik
Good question with good anxiety.
I think one should make difference between the things.
1. Returns over invested capital, to agree with you, alone do not constitute the core of corruption. But the form of activity, no doubt, may qualify for the label, especially with respect to the law of the nation.
2. Corruption is always with reference to the law, custom or morality of the country and also with how does one defines it.
3. Law and state themselves may, and do, breed corruption.
4. Law and institutions are the very instrument which make an investor earn and accumulate profits and assets. Hence, the same mechanism requires its share out of the accrued gains which could not have been there but for the presence of the way the institutional design of the economy is made. Taxes as demanded by the state are the price of having the environment favorable to the capitalist investor. Thinking of taxes as the unnecessary burden is betraying with the provider of the business environment. Just think of a situation where property is distributed and owned equally by all individuals such that all have enough means to work for themselves and get benefit for themselves. Would it be possible in such a case for your assumed investor to accumulate heaps of profits and then deny the state's share!
5. What if the necessary property rights, relations of production, and the physical capital etc. are not provided by the state? Would there be any profits?
6. So, what I think, corruption is very much an institutional mechanism and the state deals with it in an institutional way.
7. As for as society is concerned, corruption is the deficiency of moral and ethical behavior on the part of individuals, organizations, and most importantly the state as the root source! And all these gainer-agents are the least interested in the mitigation of the same deficiency of behavioral standards, equity, and justice because doing so is against their self-interest!
Sorry for anything inconvenient.
Israr
Dear Israr, Your explanation is justified and it requires more response from others.
-Bhowmik
Dear colleague,
i think your question hides an issue. It is no corruption to buy whatever you want (city or country if you will). Corruption becames when you need to pay to someone first that this becomes possible (buying a country is not possible - because country is political and not economic category (different spheres of social environment)). So my argument is, if something is possible to buy and everyone has equal opportunity to buy it - no corruption. If one of buyers tries to pay the possibility to buy to certian structure (this way monopolizing the right to buy) this is corruption. Especially if the item is not available to sell in first place or in the case that by paying extra to certian subjects, would disable the possibility that item would be sold for more.
item A - not for sale -> pay person B ->item A for sale with exclusive right to buy by person C = corruption
item A for sale =1000 $ person C offers 1500$ person D offers 2000$ -> item sold to person D = not corruption
item A for sale =1000 $ person C offers 1100$ + 400$ to person B, person D offers 2000$ -> item sold to person C = corruption
Well i tried to make it simple - reality, we both know, is different. And that is why you need anti-corruption legislation, which obviously covers broader range of possible immoral business practices than discussed above.
Dear Pinteric, Your citation and examples are very right. Grossly I have pointed the mode of these things in Capital Economy.
1. item A - not for sale -> pay person B ->item A labeled 'for sale'* with exclusive right to buy by person C = not- corruption
*point that the authority of 'not for sale' has the right to term it 'for sale', - there is no corruption. That is a business policy only. It is just like 2.
2. item A for sale =1000 $ person C offers 1500$ person D offers 2000$ -> item sold to person D = not corruption
3. item A for sale =1000 $ person C offers 1100$ + 400$ to person B and final*, person D offers 2000$ -> item sold to person C = not-corruption
*hare B is the auction authority and possesses the right to finalize and may say, it is been already final to C; D, you are late -then there is corruption as per rule.
Please help me with next.
It is interesting debate that capitalist economy is based on making unlimited profits. Monopolies, oligopolies, duopolies are form of economic entities that can make kinds of profits mentioned above. The producers of goods and services, however, know how much it costs to produce a good or service. So what is a reasonable profit? There would be different answers to this question, and some may make 100% or more as a profit. For limiting unlimited human greed, the anti trust laws of the country check collusion, cartels etc.. Then there is ethical side of the question of managing greed and corruption.
Thanks to Waheed, please think more rational and share with others.
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