Leadership Power Point Presentation on

Corruption in Leadership
Siena Heights University
LDR 601
Presented by: Marvin Hawkins, Douglas McCray,
Marc Pierce, &Theresa Strauch
Based on the article,

Understanding the Spread of Systemic
Corruption in the Third
World by Feisal Khan

Professor of Economics at
Hobart and William Smith Colleges

Introduction
Corruption of Third World Countries
Khans purpose for writing this paper is to offer a new formula to explain
how a country can go from mostly honest to mostly corrupt.

Different Models of Corruption Defined:
Principle Agent Model: Common example of this relationship includes corporate
management (agent) and shareholders (principal).
Threshold Model: Statistical model, distinguishing ranges of values.
Corruption: Top Down or Bottom Up- Hierarchical government. Corruption takes
many forms and can arise at many levels.

Although I have defined the different types of corruption, the power point will focus
on the concepts of leadership, how corruption effects human development and solutions
to corruption.



Article Concept
Feisal Khan wrote his paper on systematic corruption in third world
countries to offer a new model or formula to explain how a country can go
from mostly honest to mostly corrupt. As he states, The objective of this
paper is to develop a simple intuitively obvious threshold model and of how
a systemically corrupt system of government can come about (Khan,
2008).
Khan builds his model off of a principal agent model, which is useful in a
two person hierarchy with a principal and then an agent. It does not help
explain how a government or societal element can become corrupt. Hence the
development of his threshold model.
While this is Khans purpose for writing the article, his formula is not the
purpose of this power point presentation. What is the purpose is to discuss
concepts of the lack of leadership in government manifested by corruption,
some of its characteristics as well as its negative affects on the population, and
what can be done.
Importance of Leadership
On page 20, Khan asks the question, Why is leadership behavior
important? The answer in terms of corruption becomes clear; those who are
corrupt influence others on whether they will be corrupt.

If you assume that 10 % of the population is corrupt and if it is the
bottom part (has no power) of the population then it has limited impact
on society as a whole.
However, if it is the top 10% (the leaders with power), they will have a
significant impact on society. Further this type of top down path is
found to cause a faster rate of a country becoming corrupt (Khan. 2008.
p. 21).
In the above two scenarios, both have the ability to make society
corrupt. It is just the rate in which that change occurs. Also, and this is
important, both are a failure of leadership. The latter is obvious
because the leader is corrupt, but the former is also failure in that the
leaders fail to address it while it is small and isolated. This allows it to
become systematic, just more slowly.
Corruption Effects on Human Development
Khan tells us that systematic corruption will cause a low socio-economic
development in third world counties.(Khan, 2008) Khan shows us this by using
Nigeria as an example. We will expanded on this by showing that other countries
with a high ranking and a low rating of systematic corruption has a high poverty
rate with low development.

The corruption perception index tells us the Afghanistan, Somalia and North Korea
have a ranking of 174 and rating of 8. The rating system tells us that 0 is fully
corrupt and 100 is completely honest.(Transparency, 2012) With a rating of 8 you
can see that these counties are perceived as being very close to completely corrupt.
For the purpose of this power point we will be discussing Afghanistan and
Somalia.

As we look at the Human Development Reports for Afghanistan and Somalia, you
can see that these countries have a high rate of poverty and low development. The
Human Development Report does not directly relate corruption to poverty, but it
does help us show that these countries do have economic and other deficiencies.

Solutions to Corruption
Solutions to corruption in third world governments can be generic whether the
country is an Asian or European or Sub-Saharan African country. The
importance of honest leadership cannot be over emphasized. The infestation of
corruption in third world governments has been described as being top-down
in that it starts with officials in high places. Corruption at the higher levels of
management negatively affects the lower level personnel. The corrupt system
all at once imposes conditions of poverty upon the citizens and prevents the
government from improving the living conditions (Bertot, Jaeger & Grimes
2010).
In Police Ethics: The Corruption of Noble Cause, reference is made to Feisal
Khans findings in Understanding the Spread of Systemic Corruption in the
Third World. Followers emulate and take their orders from their leaders. This
means that corrupt leadership is likely the cause of continued and widespread
corruption (Caldero & Crank 2011).
Solutions to Corruption
Considering the case of the government of Mozambique, foreign corporations
and governments continued to donate aid to corrupt administrations while
adamantly protesting corruption (Hanlon, J. 2004).
Solutions to corruption in third world countries such as India, The Ukraine,
and particularly Afghanistan, and Somalia can be effected in different ways.
Establishing a form of government that is diverse ensures that the greatest
amount of power is not wielded by a single individual. Government must be
open or transparent to the people who elect the officials. The established ruling
class must not be able to tamper with elections (Karatnycky, A. 2005). Once
the country has rid itself of corruption, it is imperative that conditions of
transparency and openness be maintained in order to remain free from corrupt
practices.

Conclusion
As a group we have looked at the work of Feisal Khan in his article
Understanding the Spread of Systemic Corruption in the Third World. His
purpose for the article was discussed, being that he wished to develop a new
formula to help explain how third world countries can become corrupt.
However, Khan also takes time to show how that failure of leadership
contributes to this change.

An examination was done on the importance of leadership, in so much as
leaders have strong influence on those who work under them and eventually to
the overall population. In fact they have so much influence, it can be shown
that under corrupt leadership, the systematic spread of corruption occurs more
quickly.
References
Bertot, J. C., Jaeger, P. T., & Grimes, J. M. (2010). Using ICTs to create a
culture of transparency: E-government and social media as openness and
anti-corruption tools for societies. Government Information Quarterly,
27(3), 264-271.
Caldero, M. A., & Crank, J. P. (2011). Police ethics: The corruption of noble
cause. Burlington, MA: Anderson Pub.
Hanlon, J. (2004). Do donors promote corruption?: the case of Mozambique.
Third World Quarterly, 25(4), 747-763.
Karatnycky, A. (2005). Ukraine's Orange Revolution. Foreign affairs, 35-52.
Khan, F. (2008). Understanding the Spread of Systemic Corruption in the
Third World. American Review of Political Economy, 6(2), 16-39.
Lewis, M. (2011). Boomerang travels in the new third world. New York, NY:
W.W. Norton& Company, Inc.
References
Saba, D. S., & Zakhilwal, O. (2004). Security with a Human Face: Challenges and
Responsibilities. Islamabad: UNDP Afghanistan National Human Development
Report.
Transparency International. (2012). Corruption perceptions index 2012. Retrieved
from http://cpi.transparency.org/cpi2012/results/
United Nation Development Program. (2012). Human development report
Somalia 2012 . Retrieved from
http://hdr.undp.org/en/reports/national/africa/somalia/Somalia%20Report%202012.
pdf
United Nation Development Program. (2004). Afghanistan human
development report 2004. Retrieved from
http://hdr.undp.org/en/reports/national/asiathepacific/afghanistan/Afghanist
an_2004_en.pdf