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Poverty causes corruption!

Can poverty be a justification for corruption? Or the reason behind it? Many studies show that corruption and poverty are closely linked. Corruption is also a major determinant of poverty. But it is a consequence of poverty as well? Marginalised poor suffer from lack of financial inclusion. Does this cause them to resort to corruption in a bid to reduce economic inequality? Let us examine a wealth of arguments to ascertain if poverty does indeed lead to corruption!


1. Poverty is closely linked to corruption : Corruption is an obstacle for the eradication of poverty and vice versa. Given that the poor have limited opportunity to satisfy their needs, they have a greater chance of trying to access ill gotten wealth in a bid to gain welfare benefits.

2. Poor are trapped in a vicious cycle : The vicious cycle of poverty has trapped marginalised persons and the only way out is through reliance on bribes and illegal payments to access basic, fundamental services such as telecommunications, electricity and more.

3. A cure for double exclusion : In countries like India, where corruption is the game spoiler, poverty is a major reason why people face double exclusion and marginalisation. Increased corruption is caused by reduced sustainable growth and slower incidence of poverty reduction. Corruption is as much a symptom of poverty as it is cause.

4. Studies show corruption and poverty are irreversibly linked : World Bank has warned that corruption is the greatest obstacle to poverty reduction. The opposite also holds true as studies find that corruption is more widespread in countries where there is economic deprivation. Most of the developing nations top the list of corrupt countries while economically advanced and developed nations top the list for honest practices.

5. For the poor, corruption is the only way of life : Given that poor people cannot access opportunities unless they resort to corruption, it remains the only solution in a society where the administration is ineffectual, the policies are not implemented and the poor have no respite.

6. If poverty is the disease, corruption becomes the cure : The poor can only access development and economic security if they resort to corruption. Poverty results from the inability of people to access even the basic necessities of life. Poverty includes inability to access essential services, basic civil rights, human development and empowerment. While poverty lines vary across time and societies, what does not change is that the poor are at the lowest rung of development.

7. Absolute and relative poverty both increase vulnerability to corruption : Both these types of poverty lead to corruption. Absolute poverty stems from lack of adequate resources to keep body and soul together while relative poverty defines income scarcity in relation to the average. So, whether it is slum dweller lacking electricity or a poorly paid government employee lacking opportunity, corruption beckons with equal force to both.

8. Personal gains are more than just monetary : Corruption offers poor people the ability to access resources and facilities beyond their means. Corruption is a breach of law or deviation from societal norms and results in misuse of authority. Consideration of personal gains is beyond just the monetary.

9. Studies show inverse correlation between aggregate economic growth and corruption : This means that the lower the income, the higher the corruption or breach of law. Further, corruption aggravates poverty and there is a two way dance between them. The cycle is continuous and the number of people falling prey to corruption is higher in emerging economies.

10. Poor pay more bribes : Empirical analyses has demonstrated that poor pay higher share of income on bribes than rich and do so because they are more dependent on public services than the rich.

11. They have no recourse to any other action : Lack of power for poverty stricken people stems from lack of legal course and representation and property rights are not well established. This further increases corruption and bribery among poorer sections of society.


1. Many poor people are honest : Not every poorly paid government official demands bribes or is corrupt. Not every poor person resorts to bribes to take advantage of public services.

2. Many rich people are corrupt : Many rich businessmen and entrepreneurs resort to bribery on a daily basis. They are more prone to corruption than poor people.

3. Corruption steams from inequity, not poverty : Poverty alone is not enough to lead to corruption. Inequity and lack of equal opportunities are responsible for corruption. Lack of adequate management of resources and corruption in allocation of state resources is responsible for such practices.

4. Good governance weeds out corruption : Empirical analysis has shown good governance reduces poverty while increasing equality in society. This helps to root out corruption and creates a positive environment for stable economic growth. Poverty has nothing to do with this.

5. Corruption is associated with low income growth : Lower incomes attract corrupt practices. Persons may be above the poverty line and still resort to bribe taking therefore.

6. Corruption occurs when resources don’t reach people : A major source of deprivation and backwardness, corruption hurts when resources do not reach people dependent on quality of governance and state support. Good governance reduces poverty and increases transparency, thereby lowering corruption.


Anti-corruption strategies that are pro-poor recognise the role of wealth, abuse of power and poverty in corrupt practices. Unequal income distribution is linked to high level of corruption. Corruption also stems from lack of regulatory and anti-corruption frameworks and lack of accountability for government officials. Social exclusion which restricts citizens’ access to decision making and political happenings goes against anti corruption as well. The final conclusion is that to fight poverty and corruption, the poor and marginalised need to be given a voice and have a say in matters. But this alone is not enough to weed out this evil. Wealthy people should also be given disincentives for bribing persons. Equal punishment should be meted out to the corrupt, regardless of their social status or political pull. Only then will the evil shadow of corruption cease to darken India’s chances for growth.


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