Inadequate budgets and salaries as instruments for institutionalizing public sector corruption in Indonesia

Author: McLeod, Ross H.

Source: South East Asia Research, Volume 16, Number 2, July 2008 , pp. 199-223(25)

Buy & download fulltext article:

Price: $28.00 plus tax (Refund Policy)

Abstract:

Soeharto used the Indonesian bureaucracy to generate rents that could be harvested by 'insider' firms, while also encouraging it to extort money from 'outsider' firms and individuals. This necessitated incentives that would ensure strong loyalty and minimize internal opposition. Government entities were provided with insufficient budget funding to cover their costs, and their officials were expected to generate cash from illegal activities, making public sector employees financially dependent on corruption. Any employee who opposed this system could expect to be restricted to earning no more than the pitifully low formal salary entitlement. The system therefore became strongly self-reinforcing.

Keywords: CORRUPTION; PUBLIC CHOICE; BUREAUCRATIC REFORM; POLITICAL MONOPOLY; INDONESIA

Document Type: Research article

DOI: http://dx.doi.org/10.5367/000000008785260464

Publication date: 2008-07-01

More about this publication?

South East Asia Research publishes articles based on original research or fieldwork on all aspects of South East Asia within the disciplines of archaeology, art history, economics, geography, history, language and literature, law, music, political science, social anthropology and religious studies. This peer-reviewed journal is published four times per year by IP Publishing in cooperation with the School of Oriental and African Studies (SOAS). SOAS is the leading centre in this field in Europe and one of the most prestigious centres of South East Asian Studies in the world.
Subscribe to this Title
ingentaconnect is not responsible for the content or availability of external websites