"State capture" versus "administrative corruption". A comparative study for the public health service in Romania

The papers tackles, from an evolutive and comparative perspective, the general issue of the state capture and administrative corruption phenomena, with specific reference to the South Eastern European states, as well as to the assessment of the perception upon these phenomena in the public health service in Romania. In this regard, the paper mainly uses the theoretical framework developed by the World Bank and turns to account empirical studies from the field literature or developed by the authors, regarding the assessment of the mentioned corruption phenomenon, in a South Eastern European and Romanian context. The analysis and research demarche refers to the compatibility of the anticorruption strategies in Romania with the general framework of these strategies promoted by the World Bank. Unlike other existent empirical studies, the ones used by the authors propose a new method of assessment, based on statistical instruments and processing, of the state capture and/or administrative capture level.state capture, administrative corruption, influence, lobbying, anti-corruption strategies.

Impact of Decentralization on the Corruption Phenomenon

Decentralization can take many forms, depending on the nature of the functions which are decentralized, at the level of the control exerted by the local authorities on these functions and the type of institution to which the responsibilities are transferred. In the developing countries, the objectives of the decentralization process are, in general, focused on improving efficiency, equity, accessibility and the quality of the services supplied, as well as of the extent to which they cover the local needs. In fact, decentralization is very clearly linked to the economic development, as well as to the democratic government systems. Through decentralization one seeks the improvement of the performances of a certain service, by changing the authority and responsibility between key-actors, the improvement of the informational flux for fundamenting decisions and assessing performance, the establishing of the accountability mechanisms and the modalities of motivating all actors to be responsible in the fulfillment of their duties (Paul L. Hutchinson, Monitoring and Evaluation of Decentralization Reforms, 2004). A mechanism for assessing changes with respect to accountability is represented by the "accountability frame” (Brinkerhoff 2003, Aucoin and Heintzman 2000). These changes, applied in a consistent and coherent manner, will lead, implicitly, to the reduction of the level of corruption in the public system. Political decentralization (devolution) - the only actual one, as considered by analysts - presupposes the transfer of attributions and afferent decisional power to the local levels of government and the implicit limitation of the central intervention capacity. This being the case, decentralization constitutes an important change in the plan of the formal institutions in a state. Fiscal decentralization presupposed the creation of mechanisms for the transfer of the financial resources to the local level. It often, but not always, goes in parallel with political decentralization. To attempt to measure the degree of political decentralization solely through the percentage of public resources spent at the local level is deceiving, because many times the local administrations simply receive mandates to execute, from the center, namely precise duties, sometimes accompanied by resources with this well indicated destination, but this does not mean in any case that their decisional power has increased. Decentralization (promoted in parallel with a certain dosage of administrative deconcentration of the central government) proved it can sometimes solve local decision problems, has eased access to the information of local nature, has certain services more efficient and made the citizens feel better represented politically. However, sometimes it has proven to be a source of new problems in its turn: The increase of the discrepancies between rich and poor communities, heavy coordination, fiscal indiscipline (Manor, 1999; Tanzi, 2001). But, especially, since through decentralization the centers of political decision are multiplied, it raised concerns related to the possibility of aggravating corruption by the local elites capturing the public institutions. In fact, the impact on the level of corruption is one of the most interesting aspects of the decentralization process, still insufficiently researched. The promoters of decentralization usually place the limitation of corruption among the benefits to be expected, this being for them an argument in favour of expediting the process. Many times, it is believed that the simple transfer of attributions and resources from the center to the other government levels will solve the problem. However, reality has proven a lot more complicated - many times, decentralization seems to be accompanied by a multiplication of the cases of corruption, at least as it is shown by anecdotic testimonies, as well as by an increase of the public concern towards this phenomenon. Some comparative studies in the latest period even reached the conclusion that, in total, more decentralization actually means more corruption (Treisman, 1999). In short, a long list of factors which can act on the relationship between corruption and decentralization, in both directions (Treisman, 2002). On the one hand, decentralization may lead to the reduction of corruption, because: • The local electives know better than the central ones the real needs of the community; therefore, it is less likely for them to act only as assignees for duties directed from the center, whose utility they doubt (fertile terrain for cynicism and corruption). • Inversely, in certain conditions, the citizens know more about the decision making process and they involve themselves more. • Competition occurs between the local administrations: Through the quality of the package of taxes and services supplied (in principle, the citizens thus being able to move, in order to opt for the package they agree most with); through the image of local government, more or less clean, moral pressure is created in order for the most corrupt administrations to act for the remedying of the situation. • Promotes, in judicious combination with deconcentration (but most often, to the detriment of the ladder), decentralization may lead to the limitation of the power of action of the bureaucratic extensions of the central government in the territory - usually, the most opaque and non-responsive part of the central administration. On the other hand, decentralization may lead to the proliferation of corruption, because: • Where the costs of civic information and participation are high, and the tradition in this sense is weak, the citizens may know more about what is happening at the center than at the local level; the few civic competences which exist concentrate in this direction. • The multiplication of the decision centers, correlated with the non-existence or weakness of the horizontal control mechanisms between the public institutions (horizontal accountability), may encourage discretionary behaviour and the breach of the law by the local political elites. • Where there are several levels of intermediary governance between the center and the local communities (regions, district, etc), it is difficult to achieve an adequate balance of power between the state’s administrative levels, such as the intermediary to not abusively exercise the newly-gained powers to the detriment of the local basic administration (the actual local authority). • Where a chamber of the national parliament is elected on explicitly territorial principles (in order to represent regions, districts, etc), and these constituencies coincide with strong intermediary governance levels, there are great chances for the emergence of obscure interests coalitions between the regional leaders and the central representatives. Taking into consideration all these aspects, the paper aim to make a analysis of the impact of the impact of decentralization on the corruption phenomenon.decentralization, corruption, impact

Ethical Aspects in the Activity of Civil Servants. Case Study Romania

Preventing corruption and improving the public service management are the main goals of the promotion of ethical standards for the civil servants. Several governments have revised their policies regarding the ethical conduct in the public service, implying both the corruption issue and the decline of trust in the public administration. In Dwight Waldo’s theory, the civil servants must take into account twelve obligations before: Constitution, law, the nation and the country, democracy, the bureaucratic organizational norms, profession and professionalism, family and friends, themselves, the communities they come into contact, the public interest or the general welfare, the humanity or the world, God or religion. Romania, under the pressure of the European Union accession process, has adopted the Law no. 7 of 2004 - “Code of Conduct of the Civil Servants”. The Code establishes the fundamental rules of conduct, compulsory for all the civil servants, emphasizing a behavioural mode that was not institutionalized or observed, like avoiding the conflict of interests and the use of the position for personal interest. The Code represents both an information instrument regarding the professional conduct the citizens are entitled to expect from the civil servants, and a way of creating an environment of trust and mutual respect between the citizens and the civil servants on one hand, and the citizens and the public administration authorities on the other hand. In the view of the civil servants, the Code represents a clear collection of rules of conduct through which the civil servants are asked to ensure an equal treatment for the citizens against the public authorities and institutions as well as professionalism, impartiality and independency, honour and correctness. The Code establishes the rights and duties of the civil servants when acting, among which the civil servants’ interdiction to demand or accept gifts, services, favours, or any other advantage for them, their family, parents or persons with whom they were involved in businesses or politics and that can influence their impartiality in acting as civil servants. Breaching this principle is what the Criminal Law regulates as a “bribe-taking” infringement. But the ethical conduct of the civil servants is not limited only to the application or observance of the provisions of this code. The ethical conduct also takes into account other aspects that the present paper aims at presenting and analysingcivil servants,ethical aspects,corruption

Instruments for Promotion and Assurance of Public Integrity

“The instruments” for supporting the strategies and programmes of public integrity represent a part of a general public integrity framework, comprising also the issue of ethics and public integrity, the legal framework, training and obviously the best practices used successfully by the public organisations. The current paper comprises the instruments concerning the integrity of civil service or institutional organisations, as well as their audit. The paper represents the fourth section of the book: “Public integrity: Theories and Practical Instruments,” published recently by NISPAcee. The first chapter of the paper refers on a large extent to the civil servants’ career, meritocracy, motivation of the civil servants as well as to Whistleblower. The second chapter is dedicated to the instruments concerning the institutional organisations, risk areas for corruption, indicators and transparency, blacklisting. In the third chapter, the audit instruments are aimed at the governmental mechanisms, comprising the method of audit of taxes, public contracts, electronic data etc. The theoretical approaches are accompanied by relevant examples from different statespublic integrity, legal framework, audit, civil service

State in Transition and Corruption. A Comparative Analysis

The late 1980’s have witnessed numerous changes in the political, economical and social structure of Eastern Europe. The fall of the Berlin Wall represented the beginning of national movements that targeted the collapse of all totalitarian political regimes in this part of the continent. The transformations that followed involved all areas of activity of the social life. In such a context of institutional remodeling, of redefining social values, the phenomenon of corruption was not only present, but had a great enough influence over the transition process. The influence of corruption manifested itself in most cases in an ambiguous legal framework, in a sum of normative acts (often contradictory ones), in a great legal instability, in a lack of reaction of the responsible institutions, etc. In the economy the effects of this phenomenon materialized in the drop of foreign investments, in the drop of the GDP per capita, in bad public investments, and so on. The comparative analysis of the present study targets mostly the way in which the administrative reform policies, the legal measures passed by the Parliament were put into action, the institutional reform, and all the measures that can determine the success or failure of an efficient anticorruption policy. Also, the process of accession is of great influence in the fight against corruption. Through the analysis of all elements taken into account and previously stated, the present study aims at distinguishing efficient methods in the fight against corruption, methods that are specific to a state in transition, but also to create a model of practices for the states in transition. The effectiveness of these measures is highlighted, among others, through the public perception of corruption, the level of economic development (GDP/capita, level of foreign investments, and so on).corruption, administrative reform policies

An empirical examination of stock market integration in EMU

This thesis provides clear empirical evidence that the establishment of the EMU has influenced the stock market integration process within the Euro-area. This is mostly evident across the large four EMU-stock markets: France, Germany, Italy and Netherlands, which appear to be near to perfect integrated after 2001. A considerable influence, but at a lower extent is also found for medium sized markets of Belgium, Finland, Portugal and Spain. Smaller markets such as Greece and Ireland appear to be modestly influenced by the establishment of the EMU, while Austria is the least integrated market within the single currency area. These findings indicate that the stock market integration process remains relatively incomplete for the medium-sized and smaller markets. Thus, the EMU-area cannot yet be considered as a single financial block implying that potential benefits of international portfolio diversification still exist across the EMU countries

Instruments for Promotion and Assurance of Public Integrity

“The instruments” for supporting the strategies and programmes of public integrity represent a part of a general public integrity framework, comprising also the issue of ethics and public integrity, the legal framework, training and obviously the best practices used successfully by the public organisations. The current paper comprises the instruments concerning the integrity of civil service or institutional organisations, as well as their audit. The paper represents the fourth section of the book: “Public integrity: Theories and Practical Instruments,” published recently by NISPAcee. The first chapter of the paper refers on a large extent to the civil servants’ career, meritocracy, motivation of the civil servants as well as to Whistleblower. The second chapter is dedicated to the instruments concerning the institutional organisations, risk areas for corruption, indicators and transparency, blacklisting. In the third chapter, the audit instruments are aimed at the governmental mechanisms, comprising the method of audit of taxes, public contracts, electronic data etc. The theoretical approaches are accompanied by relevant examples from different state

Ethical Aspects in the Activity of Civil Servants. Case Study Romania

Preventing corruption and improving the public service management are the main goals of the promotion of ethical standards for the civil servants. Several governments have revised their policies regarding the ethical conduct in the public service, implying both the corruption issue and the decline of trust in the public administration. In Dwight Waldo’s theory, the civil servants must take into account twelve obligations before: Constitution, law, the nation and the country, democracy, the bureaucratic organizational norms, profession and professionalism, family and friends, themselves, the communities they come into contact, the public interest or the general welfare, the humanity or the world, God or religion. Romania, under the pressure of the European Union accession process, has adopted the Law no. 7 of 2004 - “Code of Conduct of the Civil Servants”. The Code establishes the fundamental rules of conduct, compulsory for all the civil servants, emphasizing a behavioural mode that was not institutionalized or observed, like avoiding the conflict of interests and the use of the position for personal interest. The Code represents both an information instrument regarding the professional conduct the citizens are entitled to expect from the civil servants, and a way of creating an environment of trust and mutual respect between the citizens and the civil servants on one hand, and the citizens and the public administration authorities on the other hand. In the view of the civil servants, the Code represents a clear collection of rules of conduct through which the civil servants are asked to ensure an equal treatment for the citizens against the public authorities and institutions as well as professionalism, impartiality and independency, honour and correctness. The Code establishes the rights and duties of the civil servants when acting, among which the civil servants’ interdiction to demand or accept gifts, services, favours, or any other advantage for them, their family, parents or persons with whom they were involved in businesses or politics and that can influence their impartiality in acting as civil servants. Breaching this principle is what the Criminal Law regulates as a “bribe-taking” infringement. But the ethical conduct of the civil servants is not limited only to the application or observance of the provisions of this code. The ethical conduct also takes into account other aspects that the present paper aims at presenting and analysin

Impact of Decentralization on the Corruption Phenomenon

Decentralization can take many forms, depending on the nature of the functions which are decentralized, at the level of the control exerted by the local authorities on these functions and the type of institution to which the responsibilities are transferred. In the developing countries, the objectives of the decentralization process are, in general, focused on improving efficiency, equity, accessibility and the quality of the services supplied, as well as of the extent to which they cover the local needs. In fact, decentralization is very clearly linked to the economic development, as well as to the democratic government systems. Through decentralization one seeks the improvement of the performances of a certain service, by changing the authority and responsibility between key-actors, the improvement of the informational flux for fundamenting decisions and assessing performance, the establishing of the accountability mechanisms and the modalities of motivating all actors to be responsible in the fulfillment of their duties (Paul L. Hutchinson, Monitoring and Evaluation of Decentralization Reforms, 2004). A mechanism for assessing changes with respect to accountability is represented by the "accountability frame” (Brinkerhoff 2003, Aucoin and Heintzman 2000). These changes, applied in a consistent and coherent manner, will lead, implicitly, to the reduction of the level of corruption in the public system. Political decentralization (devolution) - the only actual one, as considered by analysts - presupposes the transfer of attributions and afferent decisional power to the local levels of government and the implicit limitation of the central intervention capacity. This being the case, decentralization constitutes an important change in the plan of the formal institutions in a state. Fiscal decentralization presupposed the creation of mechanisms for the transfer of the financial resources to the local level. It often, but not always, goes in parallel with political decentralization. To attempt to measure the degree of political decentralization solely through the percentage of public resources spent at the local level is deceiving, because many times the local administrations simply receive mandates to execute, from the center, namely precise duties, sometimes accompanied by resources with this well indicated destination, but this does not mean in any case that their decisional power has increased. Decentralization (promoted in parallel with a certain dosage of administrative deconcentration of the central government) proved it can sometimes solve local decision problems, has eased access to the information of local nature, has certain services more efficient and made the citizens feel better represented politically. However, sometimes it has proven to be a source of new problems in its turn: The increase of the discrepancies between rich and poor communities, heavy coordination, fiscal indiscipline (Manor, 1999; Tanzi, 2001). But, especially, since through decentralization the centers of political decision are multiplied, it raised concerns related to the possibility of aggravating corruption by the local elites capturing the public institutions. In fact, the impact on the level of corruption is one of the most interesting aspects of the decentralization process, still insufficiently researched. The promoters of decentralization usually place the limitation of corruption among the benefits to be expected, this being for them an argument in favour of expediting the process. Many times, it is believed that the simple transfer of attributions and resources from the center to the other government levels will solve the problem. However, reality has proven a lot more complicated - many times, decentralization seems to be accompanied by a multiplication of the cases of corruption, at least as it is shown by anecdotic testimonies, as well as by an increase of the public concern towards this phenomenon. Some comparative studies in the latest period even reached the conclusion that, in total, more decentralization actually means more corruption (Treisman, 1999). In short, a long list of factors which can act on the relationship between corruption and decentralization, in both directions (Treisman, 2002). On the one hand, decentralization may lead to the reduction of corruption, because: • The local electives know better than the central ones the real needs of the community; therefore, it is less likely for them to act only as assignees for duties directed from the center, whose utility they doubt (fertile terrain for cynicism and corruption). • Inversely, in certain conditions, the citizens know more about the decision making process and they involve themselves more. • Competition occurs between the local administrations: Through the quality of the package of taxes and services supplied (in principle, the citizens thus being able to move, in order to opt for the package they agree most with); through the image of local government, more or less clean, moral pressure is created in order for the most corrupt administrations to act for the remedying of the situation. • Promotes, in judicious combination with deconcentration (but most often, to the detriment of the ladder), decentralization may lead to the limitation of the power of action of the bureaucratic extensions of the central government in the territory - usually, the most opaque and non-responsive part of the central administration. On the other hand, decentralization may lead to the proliferation of corruption, because: • Where the costs of civic information and participation are high, and the tradition in this sense is weak, the citizens may know more about what is happening at the center than at the local level; the few civic competences which exist concentrate in this direction. • The multiplication of the decision centers, correlated with the non-existence or weakness of the horizontal control mechanisms between the public institutions (horizontal accountability), may encourage discretionary behaviour and the breach of the law by the local political elites. • Where there are several levels of intermediary governance between the center and the local communities (regions, district, etc), it is difficult to achieve an adequate balance of power between the state’s administrative levels, such as the intermediary to not abusively exercise the newly-gained powers to the detriment of the local basic administration (the actual local authority). • Where a chamber of the national parliament is elected on explicitly territorial principles (in order to represent regions, districts, etc), and these constituencies coincide with strong intermediary governance levels, there are great chances for the emergence of obscure interests coalitions between the regional leaders and the central representatives. Taking into consideration all these aspects, the paper aim to make a analysis of the impact of the impact of decentralization on the corruption phenomenon

State in Transition and Corruption. A Comparative Analysis

The late 1980’s have witnessed numerous changes in the political, economical and social structure of Eastern Europe. The fall of the Berlin Wall represented the beginning of national movements that targeted the collapse of all totalitarian political regimes in this part of the continent. The transformations that followed involved all areas of activity of the social life. In such a context of institutional remodeling, of redefining social values, the phenomenon of corruption was not only present, but had a great enough influence over the transition process. The influence of corruption manifested itself in most cases in an ambiguous legal framework, in a sum of normative acts (often contradictory ones), in a great legal instability, in a lack of reaction of the responsible institutions, etc. In the economy the effects of this phenomenon materialized in the drop of foreign investments, in the drop of the GDP per capita, in bad public investments, and so on. The comparative analysis of the present study targets mostly the way in which the administrative reform policies, the legal measures passed by the Parliament were put into action, the institutional reform, and all the measures that can determine the success or failure of an efficient anticorruption policy. Also, the process of accession is of great influence in the fight against corruption. Through the analysis of all elements taken into account and previously stated, the present study aims at distinguishing efficient methods in the fight against corruption, methods that are specific to a state in transition, but also to create a model of practices for the states in transition. The effectiveness of these measures is highlighted, among others, through the public perception of corruption, the level of economic development (GDP/capita, level of foreign investments, and so on)