How does political corruption affect economic development? 🔊
Political corruption adversely affects economic development by eroding trust in institutions and deterring investments. Corruption can lead to misallocation of resources, where funds intended for public services or infrastructure are siphoned off for personal gain. This behavior stifles innovation and hinders fair competition, ultimately affecting economic growth. High levels of corruption can create a negative image of a country, making it less attractive to foreign investors and heightening risks for domestic entrepreneurs. Furthermore, as public dissatisfaction grows, it may lead to unrest, further destabilizing the economic environment and hindering progress.
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