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Ethics

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Business
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university of mumbai
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Running head: ETHICS 1
Ethics
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Institution
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ETHICS 2
Ethics
Question 1
The amount of corruption in a particular country is inversely proportional to economic
development. That is because studies carried out by different researchers have established that
corruption hinders economic development (Aidt, 2019). Therefore, the higher the level of
corruption in a country, the lower will be the level of economic growth. Other research papers
state that corruption reduces economic performance in any given country. According to Gyimah-
Brempong (2015), the reduction in the level of economic development is as a result of inefficient
investments as well as production factors being misallocated. Also, the increase in transaction
costs, as well as uncertainties, result in decreased economic expenditures since investors fear to
invest in an economy full of uncertainties and risks. It is worth noting that reduced investments
result in a drop in the level of economic development.
Besides, some forms of corruption such as bribes where investors have to pay something
to get things done, makes the market to be unfair. Therefore, there are no equal investments
opportunities as the opportunities available are distributed unfairly to investors who are willing
to pay bribes. Also, in a recent study, it was established that higher levels of bribery usually
retards both labor productivity and real sales growth in different companies (Gyimah-Brempong,
2015). However, some studies argue that higher bribery levels facilitate the performance of some
firms. Therefore, bribing companies usually get preferential treatment from government officials;
hence, this allows them to grow faster (Gyimah-Brempong, 2015). On the contrary, most
empirical research carried out by different economists and scholars established that bribes
usually act as additional expense or fee (Aidt, 2019). This, in turn, increase the operational cost,

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1 Running head: ETHICS Ethics Name Institution Course Date 2 ETHICS Ethics Question 1 The amount of corruption in a particular country is inversely proportional to economic development. That is because studies carried out by different researchers have established that corruption hinders economic development (Aidt, 2019). Therefore, the higher the level of corruption in a country, the lower will be the level of economic growth. Other research papers state that corruption reduces economic performance in any given country. According to GyimahBrempong (2015), the reduction in the level of economic development is as a result of inefficient investments as well as production factors being misallocated. Also, the increase in transaction costs, as well as uncertainties, result in decreased economic expenditures since investors fear to invest in an economy full of uncertainties and risks. It is worth noting that reduced investments result in a drop in the level of economic development. Besides, some forms of corruption such as bribes where investors have to pay something to get things done, makes the market to be unfair. Therefore, there are no equal investments opportunities as the opportunities available are distributed unfairly to investors who are willing to pay bribes. Also, in a recent study, it was established that higher levels of bribery usually retards both labor productivity and real sales growth in different companies (Gyimah-Brempong, 2015). However, some studies argu ...
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