The Reserch Of Corruptions In Economic Transition Process

This paper is aimed to answer following questions,or to find a new way to answer them: 1.Why do serious corruption always occur in economic transition process? Which features of economic transition countries breed corruption? 2.Why do corruption persist so long in economic transition countries? 3.Can corruption affect economic performance? Through which path this effect happens? 4.How do the economic transition countries eliminate corruption?The structure of this paper is as follows.The first section is literature review.In the second section,I analyze the institutional reasons of economic transition countries' corruption.The formal institution's failure and the informal institution's success are the causes of economic transition countries' corruption.The reshaping of property right enforces the enterprisers' private property performance and the reshaping of enterprise give enterprisers opportunities to seek rent.In transition process,price reform and market reform may make room for corruption,but with reform deepening,corruption can be remedied.In the third section,I take China as an example of economic transition countries,investigating further to reasons of corruption in economic reform.The dual-track system is a key reason of corruption's appearance.China's market reform can create a monopoly section structure and then breed corruption.The slow rhythm of China's finance market is also a cause of corruption.At last,China's Regionally Decentralized Authoritarianism and regional competition help to control corruption only if central government's personnel control can create incentive to be honest.In the fourth section,I develop a dynamic model to explain the connection between property rights institutions change and corruption.The model is based on game theory's bargaining solution.The model analysis finds that corruption performs inverted U-shaped in economic transition.At the beginning,since resource is limited,the property rights protection level is low and corruption is serious.With economic reform going deep,economic begins to grow and resource is abundant,the property protection level rises and corruption can be eliminated.In the fifth section,I develop two theory models to explain how corruption affects economic performance.One is based on the property rights institutions change in economic transition and another is based on public good's spillover effect on economic development.The first model brings light on that corruption rust property protective institution,it discourages investment and distort the talent location,finally has a negative effect on economic performance.The second model reveals that if the reward of public section investment and private section investment are different,then there exists an appropriate corruption level on long economic growth path.It makes the society in “Pareto optimal” state.In the sixth section,I am trying to find an effective solution for economic transition country's corruption.I use China's data to prove that improving market institution and property rights protective institution is a key solution for economic transition country.Its benefit is better than rising bureaucratic wages and enforcing law execution.