Governance and Business Strategy Essay Example | Topics and Well Written Essays - 1250 words

Governance and Business schema - Essay ExampleDeveloping countries normally tend to deal with institutional, social, political, and cultural obstacles in order to chance upon sustainable growth rather than focusing on anti- degeneration strategies. Data from developed countries indicate their successful posture against subversive activity practices. The objective of this paper lies with discussing how corruption as a social evil would impede the economical development of a country. According to the view of International Organization of Employers (2009), though corruption is common in all areas of daily life, public sector is found to be the most prospective area for corruption practices (The fight against bribery and corruption). It has been identified that corruption practices exist even in democratic countries where political indicant is based on clientalism. To illustrate, in democratic countries, politicians take undue advantages of their power and take aim easy gravel to public resources. Naturally, the exploitation of social resources would lead to economic downturn as the nation is forced to respite adequate resources to the exploited ones. Cartier-Bresson (as cited in Dearden, 2000) has put forward five economic conditions which amplify corruption practices at bottom a society. ... This diversion cost indicates a non-beneficial expense as it would not contribute to the economic interests of the nation. Similarly, when corruption practices increase in a nation, it is reflected as the inefficiency of legal system and thereby potential empowerors would hesitate to invest in public ventures. From the perspective of Endogenous Growth Models, inefficiency may become the direct cause of twilight in investment because investors always give priority to the rate of return from their investment. In the opinion of Coupet (n.d), The classical Growth Model precisely indicates that misallocation of investment would check the uninterrupted and steady level flow of income, which in turn impedes the overall growth of the nation. Sometimes, corruption prevention be constitute a major function of nations total expenditure and it adversely affects the economic growth of the nation. When the corruption prevention costs increase, the government may cut down various fiscal benefits such as employee wages and early(a) subsidies. Moreover, it may impose additional taxes on different industrial sectors too. All such regulations would seriously intrench on the national economic development. For instance, when the employee wages are reduced to maintain corruption costs, employees normally get discontented and that may cause immense brain drain. Murali (2008) argues that in the modern business environment humans power is the most powerful weapon without which no organization can expand further. Therefore, the migration of skilled and equal employees to foreign markets would certainly weaken every developmental initiative of a country. Similar ly, when government imposes additional taxes on