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Understanding the Problems and Obstacles of Corruption in Mexico

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Understanding the Problems and Obstacles of Corruption in Mexico ISSUE BRIEF 09.13.18 Understanding the Problems and Obstacles of Corruption in Mexico Jose I. Rodriguez-Sanchez, Ph.D., Postdoctoral Research Fellow in International Trade, Mexico Center Corruption is an ancient and complex and public issue. Some focus on it in the phenomenon. It has been present in public sector; others examine it in the private various forms since the earliest ancient sector. Of the various approaches to defining Mesopotamian civilizations, when abuses corruption, the most controversial approach from public officials for personal gain were is that of the so-called moralists. From the recorded.1 Discussions on political corruption moralist perspective, an act of corruption also appeared in the writings of Greek should not be defined as wrong or illegal, philosophers, such as Plato and Aristotle.2 as it is contextual and depends upon the For centuries now, philosophers, sociologists, norms of the society in which it occurs. This political scientists, and historians have perspective, though important, has been analyzed the concept of corruption, usually largely avoided by modern social scientists in in the context of bribery. More recently, in favor of an institutional approach to defining the face of globalization and political and corruption, which is based on legal norms that financial integration, the study of corruption resolve conflicts between different sectors has broadened to include many different of a society that are affected by corruption. manifestations. Even so, there is not a single This institutional approach may better help in definition of corruption accepted by scholars measuring and combating corruption. and institutions working on this issue. The Leff, for example, avoids the moral concept is broad and difficult to define and definitions of corruption and instead defines it measure. Yet, corruption is everywhere, and as a set of norms and extra-legal institutions Corruption negatively it is the most corrosive social behavior of used by people to gain influence over the impacts major variables our time. To deter and abolish it, it must first actions of the bureaucracy.3 Institutional such as poverty, be understood and then addressed using approaches to corruption such as Leff’s, inequality, economic the right strategies. This issue brief deals however, have their own problems. One with the complexities involved in defining, is identifying the norms and extra-legal growth, social welfare, understanding, and measuring corruption— institutions and specifying how they operate skilled emigration, first steps in dealing with this pervasive to cause and incentivize corruption. Nye expenditure on problem—and uses the case of corruption in realizes this problem and argues that a education and health, Mexico, where corruption has increased in primary task in defining corruption is to recent years, to illustrate these complexities. specify the standards used to evaluate a and civil and corrupt act. Nye therefore defines corruption political rights. as “behavior which deviates from the formal DEFINING CORRUPTION duties of a public role because of private- regarding (personal, close family, private Defining corruption has been a challenge for clique) pecuniary or status gains; or violates academics and institutions around the world. rules against the exercise of certain types Some view it as an individual, moral, and of private-regarding influence.”4 In this cultural issue; others view it as a structural RICE UNIVERSITY’S BAKER INSTITUTE FOR PUBLIC POLICY // ISSUE BRIEF // 09.13.18 FIGURE 1 — THE AVERAGE CPI OF OECD MEMBERS COMPARED TO MEXICO 80 70.5 70.2 70.8 70.4 70.4 69.9 68.2 68.4 68.8 69.1 69.9 69.0 68.5 68.4 68.2 68.8 69.5 68.6 70 68.4 68.2 68.1 68.1 68.4 60 50 40 37.0 36.0 36.0 36.0 36.0 35.0 35.0 34.0 34.0 34.0 33.0 33.0 34.0 33.0 33.0 33.0 32.0 31.0 31.0 30.0 30.0 29.0 Average CPI Average 30 27.0 20 10 0 2011 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2012 2013 2014 2015 2016 2017 Mexico OECD members SOURCE “Corruption Perceptions Index Overview,” Transparency International (TI), last modified February 21, 2018, https://www.transparency.org/research/cpi/ overview. definition of corruption, Nye includes bribery, comes in the form of money.”9 The variations nepotism, and misappropriation. Following in these definitions of corruption show a Nye, Huntington defines corruption as the common theme: scholars continue to struggle deviation from accepted norms to serve with defining this concept. private ends by public officials.5 This definition Given the many issues with defining considers the existence of two parties— corruption, researchers have crafted corruptor and corrupted—in any exchange of a “thicker,” more robust description of it. resources, but fails to consider the negative Corruption, they argue, does not depend externalities of their actions. For example, on individual behavior but on collective or corruption diverts resources intended for systemic behavior. This systemic definition public works and infrastructure into private eliminates the restrictive personal gain hands and therefore causes indirect negative component in previous definitions and impacts on a society, such as unsafe buildings broadens the discussion of corruption as a or environmental degradation. social issue. According to this definition, limits Rose-Ackerman emphasizes the corrupt to state power must be established that apply links between the state and the private sector. to individuals beyond public officials. Along She defines corruption as the misuse of public similar lines, Warren expounds on the idea office for economic or political gain.6 Similarly, that corruption reduces the effectiveness of for Klitgaard, corruption occurs when public public action because it affects institutions officials make special arrangements for and state power.10 Sandoval-Ballesteros private gain.7 In both of these definitions, further conceptualizes corruption as agents are disloyal to the public interest or a “specific form of social domination common good and pursue private interests. characterized by abuse, simulation, and Bhargava adds the private sector to the misappropriation of resources arising from a definition of corruption, arguing that corrupt pronounced differential in structural power.”11 acts can also occur in it.8 Finally, Johnston This systemic approach differentiates between adds that corruption is the “abuse of a trust, individual and institutional corruption, generally involving public power, for private depending on the benefits obtained and by benefit that often, but by no means always, whom in a corrupt act. 2 UNDERSTANDING THE PROBLEMS AND OBSTACLES OF CORRUPTION IN MEXICO International agencies have also analyzed element of corruption, and he recognizes a and defined corruption. The United Nations country’s social and cultural history, along Convention against Corruption (UNCAC) does with its political and economic development, not have a specific definition of corruption as the roots of corruption. Given these factors, as such, but it categorizes different acts of Tanzi further classifies corruption into two corruption according to Chapter III of the categories: petty and grand.16 Similarly, TI convention.12 These acts include bribery also classifies corruption into grand, petty, and embezzlement, as well as money or political corruption depending on where it laundering, concealment, illicit enrichment, happens and the quantity of money lost. trading in influence, and obstruction of When defining corruption, Tanzi further justice. Furthermore, the United Nations separates the causes of corruption into direct Office on Drug and Crime (UNODC) developed and indirect factors. Direct factors are carried the International Classification of Crime for out by the state under monopoly conditions Statistical Purpose (ICCS) to classify all types and discretional power, and include activities of criminal offenses into categories with a such as regulation, authorization, taxation, common framework for all countries. The ICCS and the provision of goods and services at includes the following as corrupt acts: bribery below-market prices. Indirect factors include (passive or active), embezzlement, abuse the quality of bureaucracy, level of public of functions, trading in influence, and illicit sector wages, penalty systems, institutional enrichment, among others.13 The World Bank controls, and transparency of rules, laws, Developing countries (WB) includes nepotism, theft of state assets, and processes. Lambsdorf further identifies and the diversion of state revenues as corrupt similar causes of corruption: government size, do not have specific acts. The WB, along with the Organisation for institutional quality, absence of competition, strategies or legal Economic Co-operation and Development salaries, press freedom, democracy, gender, systems to deter (OECD) and Transparency International (TI) and cultural determinants.17 corruption and, define corruption in essentially the same Recently, researchers have proposed in some cases, way for policy purposes, as “the abuse of economic models to explain corruption using entrusted power for private gain.”14 This different causes, such as economic freedom, it has already been definition is widely used by decision-makers, economic growth, globalization, income established as despite its vagueness. Its strength, however, distribution, inflation, poverty, trade openness, normal behavior is that it accounts for the extent, impact, and political
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