Corruption: perception or reality?
Jamil Nasir

According to the Transparency International Corruption Perception Index (CPI), Pakistan has dropped from 134th place to 139th out of 176 countries. The CPI score in our case is 27. The other countries scoring 27 on the CPI are Azerbaijan, Nigeria, Kenya and Nepal. In a sense, Pakistan is at the bottom of the heap on the CPI, and we are the 33rd most corrupt nation of the world.
The report is based on corruption perceptions collected through surveys from 176 countries. The CPI ranks countries on a scale of zero to 100, with zero indicating highest levels of corruption and 100 lowest levels. A score below 50, an arbitrary cut-off line, means that a country is significantly corrupt. About two-thirds of the 176 countries ranked by Transparency International (TI) have scored below 50 – ie, passing marks.
Do we have any valid objection to our ranking on the CPI score? Perhaps not. We can raise objections of a general nature. For example, it has been said that TI rankings are based on perceptions. Ranking from year-to-year cannot be compared, as the number of countries ranked is not the same every year. So the ranking and score are both susceptible to serious errors.
The perceptions are subjective, and a score based on subjectivity may not necessarily be the true depiction of the level and extent of corruption prevalent in a country. Further, perceptions die hard. Perceptions are shaped by deep historical stereotypes, or media reports that the surveyed population may regard as fact. Are technical objections of this nature valid defence for brushing aside the report of Transparency International?
Such technical objections have been raised time and again regarding the earlier reports of TI. It is against this backdrop that researchers are now devising new methods and procedures for more objective measurement of corruption. For example, Prof Benjamin Olken of MIT calculated the bribe truck drivers had to pay the police in the Indonesian province of Aceh. What he did was to have men dressed as truck drivers’ assistants accompany truck drivers on their regular routes. The assistants noted the amounts that truck drivers paid each time they were stopped at a police checkpoint or weigh station. They thereby calculated the actual amount of bribes paid to police by truck drivers.
A similar methodology was used in Mozambique and South Africa by researchers for estimates on illegal payments made for clearance of customs cargo at the ports. Disguised as customs agents, they estimated the economic costs and distortions associated with corruption. The findings were that, on average, bribes involved in customs clearance constituted 14 percent of shipping costs for a standard container passing through the ports of Mozambique.
There are other methods through which corruption can be measured more accurately and TI should make use of such methods and techniques. But besides these technical objections, ranking by TI has assumed global recognition, and its ranking of a country on the perception index is considered the best approximation of the level of corruption in a country.
Are we not putting our heads in the sand by raising such technical objections to the report? Is it not a reality that a revenue official will not give you a copy of your property documents unless you bribe him? Can you identify even a few SHOs who are not corrupt? Is it possible to get your cargo cleared by the customs inspector without payment of bribe? Is it not a reality that honest officers are sidelined just because they are clean? Is it not a fact that files do not move in public secretariats unless you pay bribes or use connections? Is commission not charged in public procurements? Are the licenses, quotas and permits awarded without some consideration?
If corruption is so deep-rooted in society, a better course of action would be to put our house in order, rather than blaming TI. Can we afford the damage done by our high ranking on the Corruption Perception Index even if we assume, for the sake of argument, that we are not as corrupt as the report says?
Scoring high on the CPI index sends bad signals to foreign investors. According to a World Bank report: “Perception matters...and its unintended consequences may be devastating for the reputation and to its attractiveness to potential foreign investors. For example, the perception that a country has corrupt leadership is likely to make international companies reluctant to allocate foreign direct investment there, and it is likely to discourage donor countries from making loans and grants to support development projects. Both of these situations have enormous consequences for a country’s economic growth potential and for its ability to fight poverty.”
Corruption is a big impediment to economic development. We cannot grow out of corruption. It misallocates resources and talent, enhances cost of doing business, creates inefficiencies and distortions in public provision of goods and services, incentivises politicians and bureaucrats to misallocate public budgets, and deepens poverty and inequality in the society. Cultural, economic, legal and political factors are collectively responsible for this phenomenon.
We have deteriorated to such an extent that a corrupt civil servant or politician is now admired as someone “smart.” Public-office holders indulge in corruption unabashedly as our society does not frown at corrupt behaviour. Our cultural norms generally induce corruption through two main channels. First, the extended family system and tribal structures induce those who hold public office to use it to the benefit of their family and tribe. Resultantly, meritocracy and rule of law are relegated to the bottom. In a society characterised by extended-family and tribal norms, even public institutions inherit the norms.
Second, in a traditional culture where age (and, for that matter, seniority) determines status, and where people respect authority, cultural norms will be tolerant of corrupt behaviour by those who are in senior positions. It is a common observation that in public-sector departments if seniors are involved in corruption juniors will not object to that. In most cases junior officials themselves become instrumental in assisting the seniors in corruption. It is highly important to understand the cultural and social construction of corruption for an effective anti-corruption strategy.
The political and economic structures that generate rent-seeking opportunities need to be disrupted. If the political and economic structures are such that the opportunities of rent-seeking are high, then corruption will also be high. For example, developing countries rich with natural resources are generally at the bottom of Transparency rankings. What should be done? First, recognise the power of transparency and access to information. Introduce necessary legal and procedural frameworks and develop supporting institutions. Second, introduce comprehensive whistle-blowing legislation and mechanisms to implement such legislation.
Third, critically examine all regulatory frameworks on anti-corruption and come up with comprehensive legislation. Address corruption as a major issue. Mobilise civil society and the media and launch an aggressive campaign against corruption.
Fourth, put maximum premium on honesty in public-sector departments and institutions. Make it binding on public institutions to develop and put in place effective integrity-management systems. Encourage honesty. Fifth, identify the structures of incentives that make corruption more likely. Demolish such structures. Reduce cumbersome and lengthy procedures of public-service delivery and do away with discretionary powers. Sixth, strengthen institutions. Establish the supremacy of the rule of law, not rule of men. Adopt a policy of zero-tolerance for corruption. In a nutshell, we should be uncompromising in our fight against corruption if we really wish to grow.
The writer is a graduate of Columbia University with a degree in economic policy management.
Email: jamilnasir1969@gmail.com