An innovative solution to beat bribery!

Fareed Zakaria: How to beat bribery
One out of every four people on this planet paid a bribe last year. Bribery has been said to cost the world $1 trillion a year. The United Nations says bribes accounted for one fourth of Afghanistan’s annual GDP.
So I was intrigued to hear about an innovative idea to deal with corruption from one of the places most plagued by it – India.
India’s Chief Economic Adviser, the economist Kaushik Basu, posted a paper on his personal website in which he made a case for legalizing certain types of bribes.
Corruption is a huge and growing problem in India. More than half of all Indians say they had to pay a bribe last year. Many of those are what Basu calls “harassment bribes” – illegal payments to get basic services, like an extra 100 rupees to get a driver’s license or a routine permission.
These are the kinds of bribes Basu wants to change the law on. Under current Indian law, both the bribe giver and the bribe taker are guilty. If they’re caught, both are fined an equal amount, say 100 rupees. So the state gets 200 rupees total.
Basu has a radical proposal. Fine the bribe taker, the government official, 200 rupees, he says. Let the bribe giver go scot-free. So the government collects the same amount in fines, but the person who had to pay the bribe is not fined. Instead, he gets his bribe money back.

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An innovative solution to beat bribery: Farid Zakaria

Categories: Asia, Economics, India

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