The Analysis of the Globalization and Corruption - Essay Example

? Globalization and Corruption Supervisor Globalization and corruption are two features that appear in the modern world, with globalization being the main aspect of the modern world, and corruption turns out to be a consequence of globalization. From this, globalization needs to be defined from different perspectives to cater for the needs of explaining the relationship between globalization and corruption. In addition, there is mention of the role of international finance institutions and how they affect the prevalence of corruption or like of it. It is therefore the role of this paper to look into corruption, globalization and international finance institutions, and their relation to one another in corruption. Globalization can be defined from different perspectives depending on the intended consequences, where there is deeper meaning and the layman definition of globalization, where the term has been used for similarly numerous purposes. The general meaning of the term as has been used by journalists and politicians is meant to describe the spread and nature of being connected of different social and economic factors around the world (Smith and Doyle, 2002). As such, then factors include production, communication and technologies, where these have seen interlacing of economic and cultural activities. In political fronts, globalization has been used to mean the ability or efforts made by different parties to create and spread free markets for goods and services around the world. Different authors attempt to define globalization based on the origin of the term and it has since been lost as it bears a broad definition based on the many sectors it touches meaning that globalization is not definite, but broad. This makes globalization a term that can only be used in a specific manner only if the point of reference is known. In spite of this, Anthony McGrew offers a definition saying that globalization is the multiplicity of linkages and interconnections beyond border making up the modern world system (Reich, 1998). Corruption, just like ­­globalization has numerous perspectives but they all boil down to one event that does not auger well for economies and individuals that are affected. The broad definition of corruption lies in the misuse of or abuse of public office for private gain, but this does not apply to all situations, as this is restricted to the public sector rather than private entities and individuals (Bayar, 2003). This misuse is also provided with a number of means through which it can occur marking the beginning and end of corruption such pilferage, embezzlement, falsification of data and kickbacks amongst other. This way, corruption is defined on a broad perspective to cater for all events of corrupt activities, and corruption can also be case specific depending on the events that occur and the situation such as the sector affected. In the insurance sector, it is termed as fraud to steal from the agency, as it is for the private sector. Corruption can again be narrowly defined on the basis institutions and spontaneity, where these two become types of corruption based on their locality and nature (Balboa and Medalla, 2006). Globalization has a number of effects on corruption, and one of them is that it has positive impacts towards the prevention and reduction of corruption cases on a global scale. This occurs with the presence of the transnational bribery act, which serves to prevent the presence and prevalence of corruption across different countries, especially with the spread of production and cooperation between different countries (Ackerman, 2002). Because of this, globalization has put mechanisms in place to ensure that corruption does not spread and therefore remains localized to one place, from which it can be dealt with effectively. Globalization, which also occurs on a large scale for private sector companies and institutions helps to eliminate corruption by use of privatization procedures. This removes assets from state control and puts them in the control of private entities, which then means that windows of corruption by eliminating certain powers from state official kills corruption through globalization (Ackerman, 2002). This also comes with rules that prohibit corruption by having codes of conduct and ethics that are demanded by different governments around the world (Cragg, 1998). On the other hand, there is also the negative perspective of having globalization as a tool advocating the spread of corruption, where different multinational corporations have been found to the promoters of corruption through bribery. Bribery, which requires effort between the parties involved, has spread through globalization to lands where it did not exist before such as Africa, and as a result has painted globalization as a tool for corruption’s spread. In addition, globalization of culture is a negative aspect in corruption, where it has been observed that the spread of capitalist cultures has led to favouritism, which is a form of corruption affecting poor populations and countries adversely (Matei and Matei, 2007). Globalization, on a different scale is a contributor to corruption through employment of expertise from foreign expatriates who then use their skills to cover their activities in poor countries marking the role of globalization in the spread of corruption (Myint, 2000). Other than multinational corporations, international financial institutions have a role in combatting corruption through several means, which include ensuring stable economic markets as has been seen with exchange markets that prevented fluctuations in exchange rates. This way, money markets are protected from corruption by keeping a status quo instead of fostering financial crises that contribute directly to corruption through rapid changes (Intriligator, 2003). Consequently, they also have a part in combating corruption through cooperation with government agencies in cases of passing acts such as laundering acts to prevent movement of ill-gotten gains to foreign lands, and the consequent use of the funds (Balboa and Nedalla, 2006). They also combat corruption by highlighting and pointing to cases of corruption and money laundering as is done by the International Monetary fund and showing the adverse effects that culminate from corrupt activities, especially against the poor (Myint, 2000). This way, international finance institutions deter and act against corrupt individuals and nations, as well highlight corruption cases, hence combatting corruption. International finance institutions have a role in the proliferation of corruption globally through promotion of bribery cases where these financial institutions serve to provide and handle funds for multinational or global corporations. Because of handling these finances, they choose to turn a blind eye as they stand to benefit from the bulk of funds they hold on behalf of these corporations. Other than this, they also aid and abet in corruption through bribery, where they falsify information on behalf of nations and other companies with receipts being highly inflated to cater for bribes and minimize detection (Balboa and Medalla, 2006). They also fail to highlight the consequences of having corruption from different perspective and to different people such as poor populations making corruption seem like a normal thing, especially considering even capitalism has spread the same. In addition, these institutions support laundering by assisting corporations and covering up for them and gaining the profits by colluding. Altogether, corruption and globalization are two related aspects with each standing on its own, but with globalization, corruption has come to be a widespread event all around the world. This has been done on a cultural level through capitalism and even production lines, as well as the concept of international finance institutions, where they have served to contribute or deter the prevalence of corruption on different fronts. This is especially through measures and legal cooperation to deter, while prevalence is promoted with money laundering and colluding with institutions and failing to address the full consequences of corruption. References Smith, M. & Doyle, M. (2002). Globalization: theory and experience. Retrieved from http://infed.org/mobi/globalization-theory-and-experience/ Cragg, A. (1998). Business, globalization, and the logic and ethics of corruption. International journal vol. 53 (4). Ackerman, S. (2002). “Grand” corruption and the ethics of global business. Journal of banking & finances vol. 26, 1889-1918. Reich, S. (1998). What is globalization? Retrieved from http://kellogg.nd.edu/publications/workingpapers/WPS/261.pdf Intriligator, M. (2003). “Globalization of the world economy: potential benefits and costs and a net assessment”. Milkeninstitute. Retrieved from http://www.milkeninstitute.org/pdf/globalization_pb.pdf Myint, U. (2000). Corruption: causes, consequences and cures. Asia- pacific development journal vol. 7 (2), pages 33-58. Bayar, G. (2003). Corruption- A game. Retrieved from http://etd.lib.metu.edu.tr/upload/678664/index.pdf Matei, L. & Matei, A. (2007). Globalisation of Corruption” and Development of the Binom “Corruption-Public Integrity” in the Context of Romania Integration. Retrieved from http://www.ipa.udel.edu/3tad/papers/workshop6/Matei.pdf Balboa, J. & Medalla, E. (2006). Anti-Corruption and Governance: The Philippine Experience. Retrieved from http://www.apec.org.au/docs/06ASCC_HCMC/06_9_1_Balboa.pdf Read More