ECA Seminar paper takes an innovative look at corruption
By Andrew Allimadi, Communication Officer, TRID, ECA
29 October 2004

Joseph Atta-Mensah, Senior Economic Affairs Officer at the Economic Commission for Africa's Trade and Regional Integration Division (TRID) is working on a unique method of measuring the impact of corruption on countries. The paper was first discussed at the monthly seminar series organized by TRID, whcih took place on the 28th October this month. has The Trade and Regional Integration Division (TRID) of the seminar this month, which took place on Thursday 28 November, discussed a paper that seeks to quantify the economic damage caused by corrupt practices in countries. The paper titled "The Valuation of Corruption: An Option Pricing Approach," written by Joe Atta-Mensah, senior economic affaires officer in TRID, uses a mathematical technique common to Wall Street financiers to argue that it is possible to quantify the cost of corruption. Using formulae is a different way of measuring corruption from the standard practice, such as that used by Transparency International for example, which relies on individual perceptions to quantify corruption. The formula is important in that it allows us to quantify losses that occur from corruption and provides ideas for tackling the crisis. For example, the paper shows that by reducing the level and volatility of prices in the parallel markets, or cutting interest rates, governments can reduce the incentives for corrupt practices. You can download the paper from our web site and the author appreciates all comments, which should be sent to jattamensah@uneca.org