Corruption, defined as the “abuse of entrusted power for private gain,” has been a recurrent theme throughout South Korean (hereinafter referred to as Korean) history. Since Korea joined the Organization for Economic Cooperation and Development (OECD) in 1996, it has continuously been ranked among the lowest 20th percentile in Transparency International’s Corruption Perceptions Index (CPI) barometer. The term of corruption primarily refers to the public sector. Therefore, Shleifer and Vishny offer a more narrow definition of corruption as being “the sale by government officials of government property for personal gain.” Corruption occurs at the interface between the public sector and the private one, whenever a public official is endowed with the discretionary power over the distribution of goods and services. The consequences of corruption are multifarious, including the lowering of investment and economic growth, a loss of tax revenue, adverse budgetary consequences, for instance by reducing the level of tax collection, and a reduction of the effectiveness of aid flows in developing countries and distortion of the composition of government expenditures.
One sector that is known to be very susceptible to corruption is the construction sector, covering major public investment projects. The execution of these projects is usually contracted out by the government. Rent-seeking is among the key components of any corrupt act and large infrastructure projects are characterized by huge size and high capital intensity, making corruption in this sector more profitable than in any other sectors. In the following paper, the problem of corruption in major infrastructure projects will be analyzed with a special focus on the water sector. Chapter two offers an analysis of the problem of corruption using two economic approaches, the principal agent theory and a game theoretical analysis of the problem and its solutions. Special focus will be led onto the problem of corruption in major infrastructure projects, as well as the introduction of the integrity pact as a device to combat corruption in this sector. Chapter three presents a case study of the Korean water resource management sector and its efforts to combat and prevent corruption.The last chapter evaluates the initiatives taken by Korean society to combat and prevent corruption in the water management sector. It draws conclusions upon this evaluation, recommendation are being made.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- An Analysis of Corruption from the Perspective of Economic Ethics
- Burdening Corruption vs. Unburdening Corruption
- An Analysis of Corruption from the Perspective of Economic Ethics
- Principal-Agent Theory
- A Game Theoretic Analysis of Corruption
- Corruption in Infrastructure Projects
- Integrity Pacts
- Case Study Republic of Korea
- Country Profile South Korea
- Corruption in Korea and Anti-Corruption Measures in the Public Sector
- K-PACT
- History, Development and Organization of the K-PACT
- Achievements and Limitations
- Integrity Pact for Water Resource Management
- Water Resources in Korea
- Establishment of an Integrity Pact
- Evaluation and Recommendations
- An Evaluation of the Progress made by Korean Society
- Additional Measures and Recommendations
- Conclusion
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This diploma thesis aims to analyze the problem of corruption in South Korea's water management sector through the lens of economic ethics. The primary objective is to evaluate the effectiveness of existing anti-corruption initiatives, specifically the Korean Pact on Anti-Corruption and Transparency (K-PACT), in combating corruption in major infrastructure projects. The thesis also explores the potential for implementing integrity pacts as a tool to mitigate corruption risks within the water sector. Key themes explored in the text include:- The economic and ethical implications of corruption in infrastructure projects, particularly in the water sector
- The role of principal-agent theory and game theory in understanding and addressing corruption
- The application of integrity pacts as a strategy to combat corruption in public procurement
- The case study of South Korea and its efforts to combat corruption in water management
- The analysis of K-PACT, its achievements, and limitations as an anti-corruption initiative
Zusammenfassung der Kapitel (Chapter Summaries)
The introduction outlines the pervasiveness of corruption in South Korea and its detrimental impact on the economy. The text defines corruption as the abuse of entrusted power for private gain, highlighting its relevance in public sector procurement, particularly in large infrastructure projects like those within the water sector. The author emphasizes the need for ethical considerations in addressing corruption in this specific sector.
Chapter 2 explores the concept of corruption from an economic ethics perspective, contrasting “burdening” and “unburdening” corruption. It utilizes principal-agent theory and game theory to analyze corruption dynamics within the context of infrastructure projects. The chapter then introduces the concept of integrity pacts as a potential solution to combat corruption, laying the groundwork for the subsequent case study.
Chapter 3 delves into the case study of South Korea, examining its history of corruption and the government's efforts to combat it. The K-PACT is introduced as a crucial anti-corruption initiative, highlighting its history, structure, achievements, and limitations. The chapter then examines the specific context of water resource management in Korea and explores the potential for establishing an integrity pact within this sector.
Chapter 4 evaluates the progress made by Korean society in addressing corruption within the water management sector, drawing conclusions based on economic ethics. Recommendations for future actions and initiatives are presented, aiming to further mitigate corruption risks and enhance the ethical integrity of the sector.
Schlüsselwörter (Keywords)
This text focuses on the intersection of economic ethics, corruption, and infrastructure development in South Korea. Key terms and concepts explored include: principal-agent theory, game theory, integrity pacts, K-PACT, water resource management, public procurement, and anti-corruption initiatives. The analysis seeks to identify effective strategies for combating corruption and promoting ethical conduct within the water sector in South Korea.- Quote paper
- Annette Nölle (Author), 2010, Anti-Corruption Initiatives for South Korean Water Management, Munich, GRIN Verlag, https://www.grin.com/document/179632
