Bribery Around the World

While on the subject of bribery, it is useful to survey briefly the state of affairs in several countries. The brief summaries given here do not reflect the subtlety and complexity of local situations, which should be researched thoroughly before doing business there.

China and Taiwan. As already mentioned, bribery is common in these countries and is

corrupting because it undermines more stable forms of relationship. In China particularly, the central government strongly discourages bribery, which erodes its power.

The penalty for some types of bribery can be severe (e.g., death).

Japan. Bribery scandals periodically come to light in Japan and may result in a flurry of

prosecution and punishment. Bribery is corrupting primarily because it undermines

group solidarity, the primary mechanism for social cohesion. Group solidarity is

maintained by a careful process of cultivating loyalty and maintaining harmony, not by

side payments.

Singapore. Bribery is strictly forbidden in Singapore and is not practiced.

India. Bribery and skimming are common in India, and facilitating payments are

ubiquitous. The latter are small, routine payments made to obtain services to which one

is already entitled. They are arguably functional in that they supplement the inadequate

salaries of bureaucrats. On the other hand, bribery in the sense of influence peddling is

both unnecessary and dysfunctional. It is unnecessary because Indian business and

politics are based primarily on skilled networking and family connections, not bribes. It

is dysfunctional because it corrupts India’s quasi-Western public administration.

Although bribery is common, the system operates despite it, not because of it. It is

therefore corrupting and should be avoided.

Russia and Eastern Europe. Bribery is a way of life in many of these countries and is an

unmitigated evil. It is a symptom of system breakdown, due to a recent history of

political oppression or instability. It is best to rely on corporate clout, connections, and

pro bono activities, and to maintain a clean reputation.

Arab countries. These present a complex picture, due to regional variations and mixing

of cultures. Kickbacks are other relationship-based practices are common, but their

tendency to corrupt depends on the local situation.

Turkey. Bribes and facilitating payments are very common in both business and public

administration, and Turks find them quite irritating. Bribes that circumvent the law

undermine the country’s quasi-Western administration and should be avoided. Some

small payments may be unavoidable, as when settling a traffic ticket, getting children intoschool, or clearing customs.

Sub-Saharan Africa. Bribery in much of central and southern Africa is out of control,

and it cripples the economy. It represents the total corruption of an ancient patronage

system that once held rulers accountable. It is a symptom of social breakdown that stems from Africa’s encounter with Western powers and a radically different economic system.

Companies should use any means available to avoid paying bribes. They can often exert

the necessary influence through the potential economic benefits of their operations and

their willingness to fund infrastructure.

Latin America. Bribery is common in Latin America but not ubiquitous. It is widely

regarded as immoral, in many cases even by those who demand bribes. Bribery seems to be a holdover from a turbulent past and is arguably inessential for a system that can rely on other kinds of relationships. It in fact seems to be on the wane in some countries, such as Mexico. Business people should cultivate personal connections and avoid paying bribes. They should make it known that they work only with locals who play it clean.