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This essay explores why corruption is so widespread in developing countries. It is organized into three sections. The first section argues that a theory of corruption is needed in order to answer this question. The second section presents a theory linking corruption and development. The third section empirically documents the correlation between development and corruption.

This chapter begins by surveying some of the solutions which have been adopted to the problem of environmental and natural resource accounting. Measures of national income such as GNP/GDP from the systems of national accounts (SNA) until recently did not reflect changes in environmental resources. The roles of both physical and monetary systems of environmental statistics are discussed, and it is shown how these can be incorporated into the SNA scheme. A possible means of using such a statistical framework for the basis of economic analysis is then discussed and illustrated with particular reference to Indonesia. It is suggested that a social accounts matrix can be extended to include ‘environmental multipliers’ which capture the effects on the environment. While such multipliers do not show all the environmental implications, they do demonstrate that modelling environmental effects is possible using just a little more information than is available in a typical social accounting matrix.

This chapter presents a statistical inquiry to test the political hypothesis that strong social democracies widen the natural gap between managers and distant stockholders, and impede firms from developing tools that would close that gap. By arraying nations on a left-to-right political scale, and then arranging them on a highly-concentrated to highly diffuse ownership scale, the scales correlate powerfully. The political explanation accounts for the variation in ownership concentration in the world's richest nations.

This chapter reviews and critiques the various approaches to measuring social well-being. Economists have tried to argue for a single consistent criterion (based on money) but have mostly been ignored. Instead, there have been three main approaches: first, the postulate that there is a minimum set of basic needs, which should be satisfied for everyone; second the investigation into people's quality of life, whether ‘objectively’ measured or self-reported; and third the eclectic compilation of administrative and survey data according to a list of 'concerns'. There are theoretical and practical problems with the first two approaches. For the third approach, the measurement of social well-being should reflect the variety of ways in which people order their lives. Of course, there are some overbearing constraints, such as the threat of poverty or war; but, within those constraints, there are a multitude of modes of living so that the definition and specification of the elements of well-being should accordingly vary. We introduce two distinctive characteristics: first, beyond certain minima, it is not always clear how 'more' consumption adds to welfare; second, we emphasise the monitoring collective well-being both in terms of inequality and human rights and in terms of reducing ecological damage.

This chapter examines the image and reputation of former U.S. President Gerald Ford during his term. Though Ford tried to maintain good press relations, reporters often ignored substance for the sake of an entertaining caricature and he became the favorite subject of many a television show's presidential satire. Despite his accomplishments in increasing real gross national product (GNP), increasing employment rate, and reducing inflation rate, his approval rating was just 46 percent in January 1976.

This chapter argues that the EU has reached a point in its development when a giant step can be taken to bring aid to developing countries. In December 2001, the EU adopted a set of commonly agreed and defined indicators for social inclusion. These indicators covered financial poverty and its persistence, income inequality, low educational attainment, premature mortality, and poor housing. They would also help to monitor action plans and judge progress towards Social Europe. The chapter argues that this is an ideal time for the EU to take a major step on behalf of the poorest countries outside of it. A justifiable and affordable target could be agreed of providing official development assistance equal to 1 per cent of Gross National Product (GNP). This would help to meet the millennium development goals agreed at the World Summit in September 2000.

This chapter examines the fiscal and monetary achievements of the period between 1948 and 1967. These two decades were without panic, crisis, depression or more than minor recession. It was during these years that the term “Gross National Product” (GNP) was coined for the first time. Unemployment was low, there was no appreciable inflation, and the wholesale price index rose from 82.8 in 1948 to 100 in 1967. The chapter considers one idea and two institutions that were cited as the major factors for the achievements of these years: Keynesian fiscal policy, the Bretton Woods agreements, and the Employment Act (1946). It also discusses further influence that now became decisive for the advance of John Maynard Keynes's ideas: the calculations of national income, national product, and their components.

China’s thirteen years of economic reforms (1979-1991) have achieved an average GNP annual growth rate of 8.6%. What makes China’s reforms differ from those of Eastern Europe and the Soviet Union is the sustained entry and expansion of the non-state sector. We argue that the organization structure of the economy matters. Unlike their unitary hierarchical structure based on functional or specialization principles (the U-form), China’s hierarchical economy has been the multi-layer-multi-regional one mainly based on territorial principle (the deep M-form, or briefly, the M-form). Reforms have further decentralized the M-form economy along regional lines, which provided flexibility and opportunities for carrying out regional experiments, for the rise of non-state enterprises, and for the emergence of markets. This is why China’s non-state sector share of industrial output increased from 22% in 1978 to 47% in 1991 and its private sector’s share from zero to about 10%, both being achieved without mass privatization and changes in the political system.

In the chapter, Haq raises questions about the spurious relationship between GNP growth, employment and income distribution. Two decades of development experience of many developing countries suggested that high GNP growth did not guarantee elimination of unemployment or poverty reduction. He cites examples of development policies of India, Pakistan and Brazil to illustrate their preoccupation with GNP growth and their assumption that income distribution policies could be divorced from growth policies and could be added later to the equation. In this paper, Haq redefines the problem of development from GNP growth to a ‘selective attack on the worst form of poverty’. He also stresses on the need to treating employment as the primary objective of planning and using development and income redistribution policies in tandem, rather than thinking about redistribution after growth has materialized.

This chapter examines the economic forecasting records of Milton Friedman and Paul Samuelson for the US economy during the five years from 1970 to 1974, a period chiefly characterized by Nixonomics. The main sources employed for carrying out this study are threefold, namely the underused Economics Cassette Series, the many Newsweek columns written by Friedman and Samuelson, and occasional pieces contributed by Samuelson for the Financial Times. Although we look at both quantitative and qualitative forecasts, the focus is on quantitative predictions for real GNP growth, inflation, and unemployment. In quantitative terms, we find that Samuelson’s projections were more accurate during the period considered, albeit subject to various caveats.