Corruption and Primary Accumulation of Capital in Transitional Economies

Abstract

The corruption is a secondary phenomenon, because there are economic preconditions causing it. Unless the achievement of macroeconomic stability and the formation of the institutions appropriate to a market economy reach their logical ending, both of them may become the cause of corruption in the post-Communist transformation of the economy. In order to restrict corruption and establish the institution of private property, it is necessary to legalize the existing results of primary accumulation of capital, which will let it “act” in the public interest. Such an approach does not exclude the punishment of all the lawbreakers according to the law.

Keywords: corruption, macroeconomic stability, market institutions, primary accumulation of capital, transitional economy, post-Communist country

JEL Classification: H26, P21, P26, P30, P31