Corruption and Management of Capacity Building in Developing and Emerging Countries:

Abstract

We examined the phenomenon of corruption in social and economic life in Poland and found that corruption effectively undermines the functioning of the state by destabilizing the economy. One of our major findings was gross deception in project proceedings for contractor selection in major public investment sectors, for the benefit of the contractors. This type of corruption led to the de-concentration and de-specialisation of the corrupt individuals. They were forced to keep double books and bear the costs of keeping illegal transactions secret for as long as possible. This resulted in a decline of economic growth for the state. We also found abuses by private entrepreneurs in the infrastructure and legislative areas. They committed bribery to advance their own economic interests, often worth millions of dollars. These activities have suppressed the growth of states by reducing the number of investments, mismanaging natural resources, and blocking essential structural reforms. However, these pathologies were present not only in Poland but worldwide.