May 24

News of corruption in developing countries with resources can be seen every day. Stiglitz explains the cycle political corruption has in resource rich countries (use power to control resource, use resource to control power). The corruption has a direct effect on the regime depending on the value of the resources present. Bribery is a big problem in government with resources not as valuable as others as seen in the example of Brazil. Government officials can see their incentive in accepting assets from MNCs and providing them with more benefit over the resources than the country will. As the value of the resources increases the likelihood of an undemocratic regime and conflict seems to increase, as the people with power will not hesitate to use the resources to gain and keep their power. Patronage, kickbacks, extortion and bribery seem
Stiglitz later tries to show incentives to not be corrupt, which fail to impress me. The only way to eliminate corruption seems development, providing less means and reasons for corruption. Which takes us back to where we started, without helping much.
Legal immunity of officials is one of the main problems causing more incentive for corruption in developing countries, resource rich or not. Transparency is not enough without more democratization and legal improvements.
Besides, we learned that even the -ex-World Bank president(whom we expected to deal with the corruption issues) was not immune to corruption himself