Essay The Issue Of Corruption And Income Inequality

1114 Words Oct 16th, 2015 5 Pages
SEMINAR PAPER-2

1) INTRODUCTION:

Corruption is not a new phenomenon in India and has been prevalent since time immemorial. However, in recent times it’s in the public eye due to its cancerous spread across the length and breadth of the nation. Both the public and the private sectors are infected with corruption, making it an eminent threat to the prosperity of the nation (Bardhan, 1997), as it hampers economic growth, results in political instability, social capital and legitimacy, increases income inequality and has a tremendous adverse effect on the well-being of the poor (Kéita, 2010). This critical review examines three articles on the issue of corruption and income inequality. Where the Charron, Heston and Kumar articles focus on corruption in India, Gupta, Davoodi and Terme’s article focus on the issue specific to corruption and income inequality across varied regions. The difference lies in their methodology. Where, Heston and Kumar (2008) undertake secondary research, Charron, Gupta, Davoodi and Terme carry out empirical studies. The common hypotheses are, i) increases in income, reduce corruption, and ii) the higher the corruption, the higher the income inequality.
2) SUMMARY OF THE ARTICLES:

First, "Institutional Flaws and Corruption Incentives in India" (2008) by Heston and Kumar, focuses on the issues of petty corruption and the poor. They accentuate that India will not be able to achieve its full economic potential if a large population cannot…

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