The Paradox of Corruption as Antithesis to Economic Development: Does Corruption Undermine Economic Development in Indonesia and China and Why Are the Experiences Different in Each Country?

The question of whether corruption is antithetical to economic development has been extensively researched and debated since the 1960s. This has occurred largely in connection with law and economic reform efforts directed by governmental development agencies and non-governmental organizations in Western countries toward developing countries in Africa, South America, and Asia. More recently, interest in this question has been rejuvenated by China’s dramatic economic growth (especially as contrasted with other states in political and economic transition), despite widespread corruption in that country. While nearly all participants in the debate appear to agree that corruption ultimately is antithetical to long-term economic development, the extent to which it positively or negatively affects economic development in the short term depends upon highly contextual factors. In different countries and regions of the world, factors of local culture and history, the nature of the state, the type of corruption and actors involved, and the political responses and motivations to curtail corruption all inform the answer to this question.