Opportunistic behaviour- its causes and some of the consequences;
Both rent seeking and corrupt state include the idea of opportunistic behaviour.
Rent seeking:
Rent seeking is a practise where scarce resources are used to capture wealth
transfers through government intervention in economic activities. In other words
special interest groups use resources to influence the political system to earn returns
that are in excess of opportunity costs. These costs are the cost of producing goods
and services. An example of the above mentioned statement is by imposing
legislation to limit the supply of goods through the amount being produced or entry of
new manufactures. Those who already produce the goods will make bigger profits.
On the other hand government could impose restrictions on the demand through
price ceilings. Price ceilings are beneficial to consumers but have a negative impact
on producers.
In Africa, rent – seeking is very prevalent, because there are few constitutional and
institutional constraints limiting Government intervention in the exchange of goods
and services. Another example of rent seeking is where Governments allocate
import licences to selected individuals or groups as well as assigning property rights.
(Napier 2010:34)
Bureaucratic corruption:
Corruption is hard to measure or define, but in Africa there are many types of corrupt
practises, which became the standard mode of transacting political and financial
business. Over the years senior officials and even heads of state became very
brazen, by openly flouting their own countries’ laws. Examples of corruption is when
heads of state demand kick – backs when awarding state contracts which is the
most common form of official corruption.
Even though countries in Africa have legal codes and laws on paper, it is very rarely
enforced, especially by those responsible for their implementation. From the outside
states are seen as functional because it has a functioning government, a central
bank and financial institutions as well as a legal system.
Thus in theory African countries are governed by the consistent application of written
laws. And because of the written laws it allows African Politicians, power brokers and
foreign partners to manipulate the gap between theory and reality to their advantage.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller zanihstrydom. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R0,00. You're not tied to anything after your purchase.
