THOUGHTS ON CORRUPTION

The level of corruption at public owned enterprises is larger than corruption at private enterprises. Clearly because of the increased sense of ownership by those looking after the privately owned assets and the reduced sense of guilt when those assets are the ownership of “ALL” as opposed to a single owner (your neighbor).

As such corruption in an economy (as a percentage of GDP) will increase with the growth of government ownership of economic activity (growth in public sectors GDP, as a percentage of total national GDP) and will decrease as the public sector ownership of total economic activity decreases.

When the public sector dominates the economic activity of a nation, its ethics and culture will dominate that society eventually (may take 10 or 15 years for full effect, although its immediate effects can be felt within 3 to 5 years) , including those in the private side of that economy. While if Public Sector ownership shrinks to a minority, the ethics, values and culture of the private economy will dominate that society eventually including those employed by the Public Sector.

When we add a participative political system (democracy) to the above formula, we notice that democracy added to a largely privately operated economy adds transparency, improved equality and opportunity. While when added to a largely government owned economy it results in equal right to misuse public assets, be that through theft or corruption, or getting a job in government when no new employment is needed, or not showing up for work, or voting higher salaries with no economic justification etc.

Hence in highly government owned economies, less political participation decreases corruption by limiting corruption to those in power, and in largely privately owned economies political participation decrease corruption.