Tuesday, October 30, 2012

Theory of corruption

Bismillahirrahmanirrahim..

Alhamdulillah for the weather today. It is a bright and sunny spring in Sydney. In Sydney, the temperature for spring is around 20 degrees ++. Sometimes the weather can go haywire when suddenly it drops to 16 degrees or even goes up to 34 degrees (for now). I love spring because it feels like I'm in Malaysia already. ;)

Today I want to write something about my course (again!) since I thought it will be useful to write it so that others can read it too, and I would also be able to read it in the future insya Allah. Plus, I need to polish my writing skills and my grammar. I apologize if there are grammatical errors in my writing and I do appreciate everyone who read my blog, just give me a comment or feedback or critics or anything. Insya Allah, I will try to improve it for the betterment in the future.

If the jargon used in this post is not a 'publicly known' terms, do tell me cause sometimes I may do not aware of those terms.

***

Many of us may have known what the corruption is, right? But I just want to write the theory of corruption and how it begins.

Ok let us begin with definition from political economists. Pure corruption is a situation where a monetary payment (a bribe) is paid to the policy maker to influence the policy outcome (1).

Pure Corruption.

Consider a case whereby the citizens have choices whether to build or not to build the bridge (or something else). If the bridge is built, everyone has to pay the head tax for the cost of building it. In the case of not built, everyone pays nothing. Those who prefer the policy (build the bridge) will benefit from the bridge while those who do not prefer it will be worse off because they just pay the head tax but not getting any benefit from it.

For policymakers, they still need to pay the head tax no matter whether they like the project or not. So, if the bribe is higher than the tax they need to pay for the cost of bridge, they will always proceed with the policy of building the bridge so that the bribe can cover the cost of paying the tax.

Corruption is inefficient here because if the majority of the people do not prefer the policy, by proceeding with such policy, the policymakers actually do not align with what the public want. The public here means the voters or taxpayers which will pay everything for the policy.

***
From the perspective of development economics, there are two ways that we can view the corruption. First, development can cause the corruption to arise. Second, corruption can also be a reason for slowing the growth of a country.

I just assumed that everyone knows about the second perspective. Though corruption can be efficient in certain ways from political economics' view, but it is not desirable as the high corruption index always associated with developing countries.

Transparency International's corruption perception index

Ok, theoretically how does development actually cause corruption to rise?

"Corruption opportunities arise from the need for delegation in complex societies"  (2).

We begin our story of corruption with a small district where the appointed chief in a traditional village can directly monitor the behavior of villagers. The chief collects taxes needed for public goods and can also punish the villagers if they misbehave.

As the village grows and become a city, the chief needs to delegate the monitoring of behavior to the police force and tax levy to the tax collectors. The police and tax collectors observe the true misbehavior by the villagers but they have a choice whether to report it or not.

This situation causes the intermediaries appointed by the chief make a deal with the villagers. If the police report villagers' misbehavior to the chief, the villagers may be punished. But if they do not report, the chief would not know about the misbehavior. The deal made between police/tax collectors and villagers is what do we call corruption (or 'rasuah').

The larger the penalties for those misbehavior, the more likely corruption to happen.

As a conclusion, corruption can happen anywhere regardless of where we are. It can happen among politicians, policemen, tax collectors, doctors, lawyers, and even if you're a chief in the village. The corruption/bribe can be as small as RM10 or as big as infinite value. What is more important, we have to remember that our life in this dunya is only temporary.

I end my long post with hadith:

"Allah SWT melaknat mereka yang memberi rasuah dan penerima rasuah serta orang yang memberikan jalan terhadap kedua-duanya,” (Hadis riwayat Imam Ahmad)

"Penerima dan pemberi rasuah akan ditempatkan dalam api neraka". (Hadis riwayat Imam at-Tirmidzi)"

Wallahu a'alam.


Till then,
Izzah Mohammad.


Reference:

1. "Principled Agents? The political economy of good government", Timothy Besley 2006, Oxford Publication pp61.

2. Banerjee, A.V, Benabou, R., & Mookherjee, D. 2006, Understanding Poverty, Oxford Scholarship Online.

Monday, October 29, 2012

Another 2..

Bismillahirrahmanirrahim..

Alhamdulillah. All praises to Allah that made ease my journey up until now. I've just finished my first written final exam paper for the final semester of my undergraduate studies this morning (not to count online final exam of astronomy that I had last week).

FINISHED?? not YET. 1 down, 2 more to go!!

Alhamdulillah again cause I think the paper was not as tough as mid-session exam. I guess it was all because we all had experience of answering that kind of soo-specific exam paper which requires us to remember all those journal papers, name of those scholars (some great scholars has few papers with different years) and their specific experiment and arguments from other scholars that may disagree with them. The topics that were tested this morning are; credit, health and education, aid, microinstitutions, macroinstitutions (like the one I posted before), and corruption.

Now I know the nature of Development Economics- it needs you to have lots of reading. Its pretty different from other economics courses that may require you to understand and know how the graphs work and solve the problem. Though I don't really like memorizing (I forgot how did I memorize those arabic subjects during my secondary school) but I find it really interesting when I got to study something that is very close to my heart - health and education policies.

Enough with the ramblings, I just want to share something on my blog.

It is a song from Yuna. I don't really like her when she first appeared to be a singer - may be cause I'm not such an indie lover. Ignore her appearance or status or whatever for a sec. This new single from her is not about love, but rather more towards motivating ourselves.

This song really suits me right now. I feel insecure and hopeless for sometimes. I know listening to this song doesn't change anything, but somehow it calms me down and motivates me.

For every time I was rejected, just remember that it is not the end of the world. Keep on pushing yourself Izzah, keep looking up and positive cause you can do better and hope for something more (if you really want to). 

Just listen to the heart - find the light, don't hide from your bright future and potential that you have.

May Allah ease my journey towards finding my passion in this life. I'm not stopping and will keep on searching until I found it and hold on tight to it. Between careers and passion, I will not give up for both. That is my promise to myself.

For those who have similar thought with me, I just wanna share this song. Hope it motivates you the way it did to me. You can search on youtube to listen to it.

***
"Live Your Life"

Find your light
Don’t hide from what you are
And rise before you fall
And hope for something more
Live if you really want to
Live if you really want to
Live if you really want to

All my life I’ve been looking for something amazing
It’s almost like I’ve been stargazing
The sky is right above me

We were meant for something bigger than this
Don’t ever try to dismiss yourself cause you don’t have to

Find your light
Don’t hide from what you are
And rise before you fall
And hope for something more
Live if you really want to
Live if you really want to
Live if you really want to

All my life my dreams just seemed so far away
And now it’s like they’re here to stay
I hold it close to me

We were meant for something bigger than this
Don’t ever try to dismiss yourself cause you don’t have to

Find your light
Don’t hide from what you are
And rise before you fall
And hope for something more
Live if you really want to
Live if you really want to
Live if you really want to
[x2]



Till then,
 Izzah Mohammad

Thursday, October 25, 2012

Reversal of Fortune

Bismillahirrahmanirrahim..

Alhamdulillah, tahun ni masuk tahun ke-3 dan juga tahun terakhir untuk saya beraya sebagai warga Sydney. Allah, rasanya sungguh singkat masa berlalu. Tuptup nak balik Malaysia dah kan.. Dah final sem, final year.. Sedih pun ada. Tapi lagi sedih bila asik exam time raya, asal raya je exam. Asal exam je raya. haish..

Before saya menulis mengenai econs, saya nak ucapkan selamat hari raya aidil adha kepada semua.. Taqabbalallahu minna wa minkum..

Isnin nanti insya Allah saya akan berfinal untuk first paper which is Development Economics. Development Economics ni belajar pasal developing countries - topics ranging from economic growth, aid for developing countries, credit market, health and education, institutions, corruption and a few other areas in development econs. This subject involves lots of reading because it is very2 broad topics. Every week ada a few articles from  well-known scholars in Development Economics yang harus di khatam, termasuk artikel untuk presentation, buku online dan juge buku text tebal. Subjek ni jugak banyak istilah statistics and econometrics, ye la nama pun experiment kat manusia kan.. Lagi mencabar dari experiment pure science..

Best tu best tapi banyak baca kan.. zzzzzZzz..

My interest dalam economics is more towards policy for education and health. May Allah ease my journey in finding my passion. Asal tajuk essay or assignment mesti saya akan pilih 2 topik ni sebab dia best. :)

Hari ni tangan ni menggatal nak tulis something kat blog ni lepas baca blog orang lain kan. and lepas study buku Banerjee sebab saya rasa ia menarik..

OK. Nak cerita pasal term 'REVERSAL OF FORTUNE'. Salah satu istilah yang baru belajar dalam subjek ni.

Reversal of Fortune ni ialah keadaan di mana bekas tanah jajahan European adalah lebih teruk dari apa yang pernah mereka capai 500 tahun dahulu. Kita ambil contoh Mughels (India) and Aztecs (US). These 2 districts were among the richest in 1500s, but now they are the POOREST in the world. WHY IS THIS HAPPENING?

Is it because of geographical reason?? But look at the climate and weather, position, soil type, etc. that haven't change. If they were the richest before the colonisation then they should persist to be richest even after the colonisation. Then geography is not the main causes of why it happened.

Is it due to the difference in institutions that the European colonies set up. European colonies ni pilih bulu rupanya. Dekat negara yang diorang ni boleh extract and ambil harta orang lain, dia tak set up proper institutions. Dulu2 Australia, US, Canada ni semua miskin tau, tapi sebab institutions yang bagus ni lah yang menyebabkan diorang semua jadi kaya harini.

Kenapa kena ada institutions ni?

Untuk menghalang kuasa besar dari terus sewenang2 ambil harta orang lain - macam buruh paksa, ambil hasil bumi (mcm kat msia dulu2 british ambik bijih timah kan), dan untuk legalise and enhance the property right.

Kenapa kena ada institution untuk enforce property right? 

Sebab bila ada institusi yang bagus yang boleh jaga hak milik kita (macam kita pergi tulis nama kat pejabat tanah) kita akan rasa lebih selamat, dan juga lebih selesa untuk melabur duit kita - conducive for investment and economic growth.

Di negara-negara macam Africa, India dll, European colonies tak set up those institutions - sebab dia nak ambik hasil bumi dan juga untuk diorang gunakan sepenuh-penuhnya (contohnya ambik bijih timah sampai habis ke kan). Kalau ada institution yg bagus, mesti semua orang akan protest dan buat revolution. Diktator2 macam european colonies masa zaman dulu ni memang taknak move towards better institution.

Another reason why there is difference in institution that EU set up is that the EU settlers actually didn't have immunity against local disease (malaria and yellow fever) - so ramai orang EU settlers yang pergi negara jajahan mati sbb xde immunity - and tak dapat le nak fokus buat institution ke hape.

And we can see the difference in those countries before and after EU colonisation. Austrolia ni tempat buangan pesalah2 tapi sekarang jadi negara maju - sebab orang penjajah EU  yang bangunkan..

Selain dari cerita kat atas ni, saya juga dapat membuat konklusi bahawa EU bukan sahaja datang untuk menjajah dan mengutip hasil di negara jajahan, tapi sebenarnya untuk memiskinkan negara umat-umat Islam. Kalau kita tengok sekarang ni negara umat Islam yang paling miskin kat dunia. Sedih sungguh. Orang kafir buat perancangan 500 tahun lepas untuk memiskinkan kita semua. Negara umat Islam yang tiada sistem dan institusi yang bagus - penuh dengan korupsi, penuh dengan diktator.. Allah..

Sedih.. sedih...

Solusi: tepuk dada tanya iman.. Buat masa sekarang aku juga masih mencari-cari solusi..

Panjang la pule post ni, sorry ye.

Wallahu a'alam..



Till then,
Izzah Mohammad


Tuesday, October 16, 2012

Final of the final is coming..


Bismillahirrahmanirrahim..

1. Lagu Kepada Jundullah di atas mengingatkan aku kepada tamrin yang lalu dan supaya jangan gentar dan sentiasa mengingati Allah dalam apa jua keadaan. Dan aku nak dedicate lagu ni kepada semua pejuang, ingatlah kemenangan Islam itu pasti. insyaAllah..

2. Final of the final semester is coming soon. YES. Very soon.

 29/10/2012: Development Economics
 8/11/2012: Politics, Government and Economics
 12/11/2012: Interest rate risk management

Allahu yusahhil. Final semester yang sangat busy sampai tak terasa dah sampai ke penghujung, dengan GRADUAN event, cari kerja, nak pos barang balik Malaysia, survey tax (takut corelle kena tax), pikir bond rumah, urusan nak book tiket, JPA seminar, mengajar mengaji setiap minggu dan macam-macam aktiviti ko-ko lain, tak termasuk aktiviti  jalan-jalan setiap kali cuti.. pendek kata tiap2 minggu mesti ada event. Weekend ni ada SPRING CYCLE NSW, saya join as participant kena kayuh basikal 16km. wuwu

Semoga Allah permudahkan final exam nanti. Dan permudahkan segala urusan selepas itu. Doakan saya cepat-cepat balik Malaysia dan settle down untuk kehidupan 'dewasa'.

Semua yang membaca blogpost ni doakan saya ye, insya Allah lepas final blog akan update lagi.




Izzah Mohammad.