CORRUPTION IN CHINA

Causes And Consequences Of Corruption In Contemporary China

Causes And Consequences Of Corruption In Contemporary China

Summary

Collective corruption is a form of corruption that occurs when a group of corrupt people conspire and collude to pursue individual interests at public expense. Collective corruption is not conducted by a lone individual; rather, it is a kind of collective behavior of aggregates of discrete individuals. Collective corruption entails innovative and sometimes extensive use of planning, collaboration, and other organizational means without ethical and legal boundaries.

Introduction

Western literature on corruption has yet to pay enough attention to the role of collusion in corrupt activities. Theoretical works addressing this issue can hardly be found in China. Corruption may be highly individualized, idiosyncratic, and extra-organizational (Ekpo, 1979), due to its clandestine nature. Corruption studies tend to focus on corrupt activities in relation to public office, powers, and resources more than the relationships among individual actors. This can be seen in the public-office-based approaches, the “market” and “profit maximization” analyses (Rose-Ackerman, 1978; MacRea, 1982; Klaveren, 1989), and the studies of public perceptions of corruption represented by Heidenheimer's well-known classification of “white”, “gray” and “black” corruption ( Heidenheimer, 1970).

The principal-agent-client approach to corruption has shifted the focus more toward the interactions among actors (Rose-Ackerman, 1978; Klitgaard, 1988). In a given corruption case, the roles and interests of those involved are largely defined by their relationships with other people rather than against external standards. The “agency relationship,” the basic unit of the principal-agent-client analysis, includes a principal or supervisor who embodies public interests, an agent acting on the principal's behalf vis-à-vis the client, and a client, a private individual whom the agent interacts with. In Rose-Ackerman's words (1978, p. 6), “While supervisors would like agents always to fulfill the supervisor's objectives, monitoring is costly, and the agent will generally have some freedom to put their own interests ahead of their principals. Here is where money comes in. Some third person, who can benefit by the agent's action, seeks to influence the agent's decision by offering him a monetary payment ….” Corruption then “occurs when an agent betrays the principal's interests in pursuit of his/her own” or when the client corrupts the agent “if he or she (client) perceives that the likely net benefits from doing so outweigh the likely net costs” ( Klitgaard, 1988, p. 23).

If we push this line of reasoning one step further by supposing that there are more than just one agent and these agents are willing to collude, then the pursuits of their individual interests and their betrayal of the principal, which would otherwise be separate efforts, may converge into collective behavior leading to more personal benefits. Corruption, in such a context, is no longer an isolated action corrupt in and of itself, but a network of interactions and exchanges among corrupt individuals.

Analysis

The purpose of collective corruption is to maximize individual gains and/or minimize the risks associated with their corrupt activities. The collectivity serves as a vehicle for illicit activities and personal ...