Controlling Corruption

Corruption is the method government officials implore to extract rents from businesses. This paper uses the functionalist-modernization theory of corruption to examine governmental corruption. The primary argument is that the functionalist-modernization approach is the most efficient method of controlling corruption. The market approach to corruption argues that corruption is inevitable in a modern economy. Since corruption cannot be eliminated, the market approach focuses on how to minimize its effect on a system? Before examining methods …

…it effort toward reforming their practices. The third approach involves decreasing the level of discretion associated with corrupt act. The principal can achieve this goal by providing incentives for agents to reports corrupt acts committed by other agents. Similarly, the principal can bring in an independent auditing firm to monitor the interaction between agents and clients. An example of this approach is the office of the special prosecutor to investigate allegations against high level agents.