Meeriyabedda and Meethotamulla are Opportunity Costs of Corruption
Posted on April 18th, 2017
Dr. Chandana Jayalath
Corruption can be defined as the abuse of public power, resources and belongings for personal ends. It takes many forms and shapes. Perpetrators are skilled in developing new ways to be corrupt and cover their trickeries, frauds and scams. It has always existed in the world and now a global concern.
The opportunity cost of anything is the highest valued alternative that must be forgone when a choice is made. It is actually a cost, like a loss. The ‘loss’ here means the loss of benefits derivable from the alternative missing or not chosen. Countries with the weakest governance structures tend to be those that most need economic development. Sri Lanka is a classic example.
It is your uncle that died in a road traffic accident, due to bad roads; your cousin who died in childbirth; the people that have died from lack of infrastructure in hospitals would stay dead; similarly, those who had to leave their lives due to garbage heaps forcefully stockpiled adjacent to living areas by municipalities. So it’s not about getting the money back. It is about ensuring that the money doesn’t get stolen in the first place.
Truly, the citizens are compelled to pay for services that should be free; state budgets are pillaged by corrupt politicians; public spending is distorted as decision-makers focus spending on activities likely to yield large bribes like major public works; foreign investment is stymied as businesses are reluctant to invest in uncertain environments; and economies suffer.
But corruption not only costs in terms of money. It costs in terms of public trust and citizens’ willingness to participate in their societies. Corruption often has links to organized crime and fosters, as well as thrives, in conflict and war. Indeed, high levels of corruption can increase the likelihood of a protracted conflict. For example, efforts to tackle climate change can also be undermined by corruption as bribes are paid to ignore environmental protection rules in the pursuit of quick profits. Just talk about mosquitoes. Who are at the payroll of mosquito ring manufacturers? None other than the dirty politicians! In these ways state security and the very values of democracy can also be undermined. Finally, the development goals are a myth.
There is a proper function of opportunity cost in corruption. On one hand, it takes place due to the intention of officials to acquire additional benefit out of their legal remunerations. They are assuring of accusation in any time. They are aware of the aftereffects of the practice. So they will compare the benefit, which acquired in illegal manner and the humiliation due to being accused. Corruption occurs only if anyone offers an amount which compensates the cost of being accused and humiliations.
When corruption is widespread, it can have devastating effects on a society. In a paper published in the Journal of Economic Perspectives, Svensson surveys the literature on the economic effects of corruption, and they can be severe. He notes that there is a strong negative correlation between the wealth of a nation and its level of corruption, and that this corruption often harms the poorest in a society. The badly needed are often fallen into neglect. Meeriyabedda and Meethotamulla are classic examples.
Most of the time, corrupt officials are like parasites that feed off society and benefit only themselves. Furthermore, as corruption becomes more prevalent, ethical people lose faith in the system and are sapped of their drive to work honestly. This is opportunity cost of an activity which is equal to the next best alternative. Corruption is a serious public issue causing heavy public injustice. Frankly speaking the general masses have no sensitivity as to figures involved. Opportunity costs of corruption are much more than the actual prima-facie direct losses. Finally, the cost of corruption goes beyond money, i.e. corruption kills.