More money does not lead to better governance

June 24, 2011 by Albert Sikkema, Wageningen University

Good governance is a condition of economic progress in developing countries. But when people in a corrupt country start earning more money, the result is not development but more corruption. These findings are outlined in a publication by Wageningen UR development economists Maarten Voors and Erwin Bulte in the Journal of African Economies.

Research in has shown that good governance is good for economic growth in developing countries. By the same token, one group of researchers has claimed that economic growth and higher incomes lead to more development and less corruption. The theory is that a self-perpetuating process is set in motion in which economic growth and good governance mutually reinforce each other. But is that really so?

Voors looked for parameters with which he could calculate the relationship between governance and incomes. He used levels of corruption as an indicator of the quality of governance and rainfall levels as a condition for higher incomes. In most African countries, the economy is highly dependent on , and rainfall is the main external factor in a good harvest. More rain therefore means higher incomes, at least in the short term.

When he correlated the rainfall figures with those for corruption in several African countries, it emerged that countries with high levels of corruption became even more corrupt when incomes went up. In countries with low levels of corruption, however, went down when there were better rains and a good harvest. Voors concludes that the self-perpetuating upward spiral of economic growth and good management does exist in some African countries, but that other African countries are caught in a kind of poverty trap in which more money only leads to more patronage and . Investing in good governance in developing countries is therefore crucial to sustainable economic development, conclude Voors and Bulte.

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5 / 5 (1) Jun 27, 2011
did not need to go to Africa for this outstanding research - as the middle class continues to shrink in absolute numbers and in percentage as well - we see Amerika as controlled by a neocon/banker elite who continue to be criminally corrupt yet rewarded by QE for their effort - pot calling kettle n'est-ce pas?
0.7 / 5 (48) Jun 27, 2011
No surprise, but what's the solution? You can't militarily intervene in every circumstance, and it isn't exactly humane to to let entire peoples starve.

Maybe peoples themselves will be able to police and/or topple such regimes more regularly via social media as we have seen this year in the Middle East.
1 / 5 (2) Jun 27, 2011
Not surprising, Frank supports Muslim extremists.
The first step to end a corrupt govt is to accept the idea that anarchy, which means no central monopoly on force, is a better alternative.
Modern nation-states can't admit that anarchy may be a better alternative to no organized central state. They can't admit to the possibility that people may be able to govern themselves.
All modern conflicts in the world today are the result of the world powers forcing people into artificial nation-states they did not want.
1 / 5 (2) Jun 28, 2011
Maybe peoples themselves will be able to police and/or topple such regimes more regularly via social media as we have seen this year in the Middle East.

"The attack was one of a series against Egypts Coptic Christian minority in the weeks since President Hosni Mubarak stepped down on February 11. Since then, widespread and escalating crime has gripped the country. "
"the ruling military council, headed by Mubaraks close friend Field Marshal Tantawi, has increasingly been criticized for its biased and repressive handling of the countrys affairs. Youth protesters and bloggers have been prosecuted and given jail sentences of several years; "
Well, that facebook/twitter revolution is working out quite well in Egypt.

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