Myths about governance and corruption.

(From Business Recorder)

Byline: DANIEL KAUFMANN

Governance - which remains a sensitive and misunderstood topic - is now being given a higher priority in development circles. A few donors and International Financial Institutions (IFIs) have begun to work with some emerging economies to help reduce corruption, and encourage citizen voice, gender equality, and accountability.

When the group of eight countries announced in July their decision to double aid and debt relief to the poorest countries in Africa, governance concerns were prominent. And in May, the joint report by the Africa Commission explicitly stated: "Good governance is the key... Unless there are improvements in capacity, accountability, and reducing corruption... other reforms will have only limited impact?"

But is good governance and controlling corruption really so fundamental for development? The explosion of empirical research over the past decade, coupled with lessons from countries' own experience, have given us a more solid basis for judging the effect of governance on development, and the effectiveness - or lack thereof - of strategies to improve it.

Yet there are still unresolved, questions and debates in the development community; not only about the importance of governance, but also about the ability of IFIs to help countries improve on it. Let us therefore go back to basics and address some prevailing "myths" about governance and corruption.

-- Governance and anti-corruption are one and the same. We define governance as the traditions and institutions by which authority in a country is exercised for the common good. This includes the process by which those in authority are selected, monitored, and replaced (the political dimension); the government's capacity to effectively manage its resources and implement sound policies (the economic dimension); and the respect of citizens and the state for the country's institutions (the institutional respect dimension). By contrast, corruption is defined more narrowly as the "abuse of public office for private gain." …