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Corruption in everything: renting your own baby
From Bangalore:
Just as the painful ordeal of childbirth finally ended and Nesam Velankanni waited for a nurse to lay her squalling newborn on her chest, the maternity hospital's ritual of extortion began.
Before she even glimpsed her baby, she said, a nurse whisked the infant away and an attendant demanded a bribe. If you want to see your child, families are told, the price is $12 for a boy and $7 for a girl, a lot of money for slum dwellers scraping by on a dollar a day. The practice is common here in the city, surveys confirm.
A 1999 survey by the center found that 9 of 10 families whose relatives gave birth in the hospitals reported paying a bribe, usually to see the baby. The average amount paid has since dropped to $7 from about $16. But 8 in 10 women still reported paying bribes in 2003 - to have their baby delivered, to see the child after birth, to get their newborn immunized or to obtain medicines that were supposed to be free.
Here is the story, which also contains a good general discussion of corruption. This is yet another indication why the Indian economy is less of a threat than outsourcing critics might think. Bangalore is arguably one of the most advanced and modern corners of India.
Posted by Tyler Cowen on August 30, 2005 at 09:41 AM in Economics | Permalink
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Comments
Serious question: why is an informal charge called corruption, while a formal charge is simply a fee?
Posted by: John at Aug 30, 2005 9:54:06 AM
Define "informal"
Posted by: dilbert dogbert at Aug 30, 2005 10:05:17 AM
John,
The same reason that charging more for high demand items during times of crisis is called "price gouging" while at any other time it would be called "market forces."
But seriously, corruption is when individuals demand money to perform a job for which they've already been paid. Bureaucrats are supposed to handle the paperwork you give them, nurses and doctors are supposed to care for your newborn, and police are only supposed to arrest you when you commit a crime. Demanding money to do (or not do, in the case of police) their job is corruption.
Posted by: Xmas at Aug 30, 2005 10:05:36 AM
The first woman in the article was described as a migrant to Bangalore. Could the city be a magnet for migrants from poorer parts of India?
Posted by: Peter at Aug 30, 2005 10:11:59 AM
I wonder how corruption in India compares with corruption in China. My general feeling is that in Indian the corruption comes often in this form of 'extra' fees, while in China the corruption is more in the form of skimming government money that has come down from above and also awarding contracts to prefered companies. However, this is completely non-scientific.
What I'm really curious about is how both countries' culture of extortion/corruption will affect their [presumed] rise in economic and military power.
Posted by: ElamBend at Aug 30, 2005 12:03:43 PM
"Bangalore is arguably one of the most advanced and modern corners of India."
Is the implication here that you would expect less corruption? Because my observation is the opposite--that it is precisely the more "advanced and modern" corners of India where corruption is the highest. I suspect part of this has to do with extreme income inequality in those parts, and with rising standards of living that are unobtainable at official salaries, increasing pressures to "supplement" ones income.
Major cities in India--like, I expect, major cities almost anywhere--are certainly magnets for people hoping to find a place to make a better living. The sad truth is that many of them end up worse off. If you're a subsistence farmer in the rural hinterlands, at least you have space to build a shelter for yourself, and you can eat what you can grow, and be left relatively alone by underpaid government bureaucrats. But if you're poor in a large urban area, how will you eat and where will you sleep? Most major cities have substantial squatter communities and unauthorized slums, whose residents are prone to all kinds of extortion--paying higher prices for water, paying bribes to avoid having their communities bulldozed. But such communities can also have high levels of informal entrepreurship, and some even provide basic services for themsleves when the govenment can't--or won't.
The size of India's population means that even with a booming economy and the largest middle class in the world, theres still an even more massive number of people living in pretty severe poverty, and significant income inequality.
Posted by: Oubliette at Aug 30, 2005 12:33:21 PM
Migrants everywhere tend to be the more enterprising among us.
One advantage of cities over the country-side in India is greater educational opportunities.
Migrants to the city also can hope to escape the rigid caste/class structure in India. The lure of the software industry is what every auto-rickshaw driver that I spoke to mentioned.
DB
Posted by: Duncan Brown at Aug 30, 2005 12:54:24 PM
If you don't pay this bribe, what do they do, throw your baby in the garbage?
Posted by: Paul N at Aug 30, 2005 1:59:45 PM
Why is corruption more rampant the larger the city? Because you can get away with it. Same reason drivers are more rude in large American cities than in small cities and towns. When you are effectively anonymous it is easier to demand bribes etc. In a small place everyone knows when you are demanding bribes and you are socially shunned. The negative response from the bad behavior is more direct and the effects are more direct. In the big city you can piss off a lot of people but still have a large social circle that is either unaware that you are bribing people or do not really care because it does not directly affect them. Without the free press and widespread literacy, there is nothing to stop the spread of corruption in the big city. Look at America over the past 100 years. Big cities with a barely literate population had high corruption rates. Big cities with high literacy and a free press have lower corruption rates.
Posted by: Kevin Murphy at Aug 30, 2005 3:29:53 PM
Corruption is often a symptom of a different and deeper problem. That deeper problem is generally that the state is doing something it should not be doing, sticking its nose somewhere it should not be sticking it. For example, when the state empowers customs agents to block or not block the importation of goods, then it creates a situation in which those same customs agents have an opportunity to demand an informal fee in exchange for the importer to be let through with his goods.
Often corruption makes a bad situation more tolerable. The more the state blocks imports, the worse off people are. Corruption among customs agents would tend to open up holes in this wall, thereby improving the situation.
Posted by: Constant at Aug 30, 2005 5:20:12 PM
"I wonder how corruption in India compares with corruption in China."
The transparency.org puts china at about 3.4 on their index (higher==less corrupt), and India at 2.8.
"That deeper problem is generally that the state is doing something it should not be doing, sticking its nose somewhere it should not be sticking it."
In the transparency.org index, 'big government' countries do not correlate well with corruption in the upper end. AFAIK, all the lower end countries are prolly 'big government' countries.
Posted by: Factory at Aug 31, 2005 5:11:21 AM
"In the transparency.org index, 'big government' countries do not correlate well with corruption in the upper end."
Nevertheless there cannot be corruption where there is no opportunity for corruption. That point of opportunity should be examined: it may be that it is not the corruption that is the greatest harm, but what created the opportunity. For example, if a country places limits on imports, that creates an opportunity for corruption among customs officials. But the greatest harm could well be inflicted by the limits themselves, rather than by the corruption which has the effect of relaxing those limits.
Now it may be that some governments have managed to grow very large while remaining relatively free of corruption. That does not change the point that there cannot be corruption without an opportunity for it, and that the opportunities for it are often harmful by themselves, and may be even more harmful without corruption.
Posted by: Constant at Aug 31, 2005 10:39:46 AM
1. What can one expect from the 'public' sector?
2. Growth comes from the 'private' sector -- which has learnt to survive with these parasites. What sort of skills etc are developed in such an environment?
Posted by: Sudha Shenoy at Aug 31, 2005 12:19:48 PM
Constant, can you apply your theory of corruption to the situation described in the original article? I have a hard time imagining how to eliminate the "opportunity" for corruption in a situation where hospital staff are demanding bribes to allow new mothers to see their babies.
I also have a hard time imagining how this practice makes anything more tolerable for anyone except the recipients of such bribes, who may well be underpaid, and who gain a supplement to their income.
Posted by: Oubliette at Aug 31, 2005 12:47:36 PM
Oupliette: I wasn't able to gather enough from the article to formulate an answer. That's why I picked an example of corruption which was clearer to me. One thing that seems apparent to me is that the outrage that people are feeling seems primarily to be directed against the *precise* method of gaining payment, i.e., withholding the baby. I have in the past heard of cases where people pay doctors under the table to get preferential treatment, but I don't recall any outrage about that, presumably because the payment was up front rather than at point of baby.
I have myself paid people up front for goods and services. I did this today in a cafeteria when I bought an item of food. What makes that payment not a bribe? Well, it is understood that I need to pay. There is no Official Government Decree saying that I don't have to pay. Well, suppose that one fine day the government decrees that I don't have to pay. Suppose the cafeteria cashier ignores this decree and demands payment. Is this now a bribe?
I have also paid at the tail end for goods and services. At restaurants I pay at the end of the meal, not at the beginning.
I am not trying to indirectly answer your question about the case in the article because I don't have the details. I only want to explain why I'm not automatically outraged discovering that, gasp, somewhere in the world patients need to pay medical staff in exchange for goods and services.
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