The Economy of Influence: Integrity for Inclusive Growth – OECD

Extract from an article by Rolf Alter, Director of the OECD Public Governance and Territorial Development Directorate

Integrity can significantly boost inclusive growth and sustainable development, by assuring fair and efficient resource allocation, stimulating competition and investment, and fostering innovation. Curbing bribery of public officials and promoting responsible business conduct is important to create a level playing field for companies and to create equitable market conditions and an investment climate that provides fertile ground for business development, competition and innovation. For the public interest to prevail in policy making, accountability and integrity in revenue collection, public finance management and service delivery are crucial and encourage equality and prosperity of societies.

International Anti-corruption Day provides an occasion to zoom in on one factor within this debate that remains particularly unexplored: corruption and the capture of public policies by special interest groups. There is increasing evidence that voters feel disillusioned about political integrity and the intertwinement of elite networks across sectors in society. Indeed, less visible but equally or more harmful than corruption scandals is the influence of narrow interests on public decision making for their own profit. Lobbyists walk a thin line between sharing information, agenda setting and undue influence. Special interest groups inform, influence and sometimes tweak laws, policies and regulations through formal advisory boards and informal networks. Rules for the financing of political parties and electoral campaigns can be stretched and bent, which contributes to the erosion of the already alarming low trust levels in government and public institutions. Similarly, leaks on offshore tax evasion or former public officials taking up lucrative posts and board memberships in banks and multinationals have dented the reputation of elected politicians, established firms and respected countries.

The public sentiment runs deep. Over half of the citizens in developed countries distrust their government and a yawning trust gap is emerging between the elite and mass populations. Among the key factors cited by citizens to explain the prevailing distrust are “wrong incentives driving policies” and “corruption/fraud”. While levels of trust in government are low, trust in political parties is even lower. In addition, over half of the global population share the belief that their country’s government is either largely or entirely run by a few big entities acting in their own best interests.

SOURCE: Alter, Rolf. “The Economy of Influence: Integrity for Inclusive Growth.” OECD Insights, 9 December 2016

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