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Economics , Fifth Edition
William Boyes, Arizona State University
Michael Melvin, Arizona State University
Internet Exercises
Corruption and Productivity


In Chapter 18 we learned that productivity is the ratio of output produced to the amount of input employed. Economists often like to think that market economies tend to have resources going to their most productive uses so that productivity is maximized. However, corrupt practices by government and business will result in resource use being determined by other than productivity so that a country's growth rate suffers. To see how countries differ in terms of perceived level of corruption go to these recent rankings of corruption for many countries. Use the data to answer the following questions:

Questions

  1. Which country is rated the least corrupt of all ranked?
  2. Which country is rated the most corrupt of all ranked?
  3. For which country is there the greatest disagreement regarding the level of corruption?
  4. Give an example of how corruption in government or business might result in decision-making that reduces a country's productivity.




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