Preventive VigilanceThe Key Tool of Good Governance at Public Sector Institution
- By sunder rawat /RBI /1 year ago /56
The modern economic theory of corruption and how to prevent it emanates largely from Gary Becker’s insightful and seminal pieces on Crime and Punishment during 1968-1974. Gary Becker, a young economist at the University of Chicago, took the theory away from moral and ethical basis to one based on optimal human behaviour in response to the presented economic incentives. He examined his own behaviour with regard to undertaking parking violations when rushing to work, which involved trading off the expected cost of illegal parking in a convenient spot, which he roughly calculated as the likelihood of getting a parking ticket violation multiplied by the parking fine (assuming non-payment of the fine would be too costly not to pay up) against the benefit in the form of convenience and reaching his class in time. Often, this calculation prompted him to opt for the parking violation, as legal parking in an inconveniently located garage did not seem economically attractive!.