Financial Assignment Example | Topics and Well Written Essays - 500 words

Financial - Assignment Example A financial manager can buy a large lot of stocks if the prices of stocks are lower. Valuation Principle The valuation principle can help financial managers make financial decisions regarding whether or not to buy a common stock. The use of valuation models can help a manager determine the intrinsic value of a corporation. The application of stock valuation models can be used to determine if the market price of a stock is over or under valued. Common stocks that have a value lower than the market price should not be purchased, while stock whose valuation exceeds in the market price should be purchased. Net Present Value The net present value is an analytical tool that can be used to make capital decisions. The NPV takes into consideration all the inflows and outflows of money associated with a project to determine whether a project should be accepted or rejected (Besley & Brigham, 2000). Another important element of the NPV calculation is the fact the NPV incorporates the time value of money. The time value of money adjusts the values in order to consider inflation. Most corporate finance books have time value of money tables. According to the NPV a project should be rejected when the value of the NPV is negative. A project is accepted when the value is positive. The use of NPV calculation can be used to compare different projects.

Report on Sir Isaac Newton Essay Example for Free

Report on Sir Isaac Newton Essay Sir Isaac Newton was an English mathematician and physicist. He was considered one of the greatest scientists in history. Newton was also the culminating figure in the scientific revolution of the 17th century. Newton was best known for his discovery that the force called gravity affects all objects in space and on earth. .Isaac Newton was born on December 25, 1642, in the hamlet of Wollsthorpe, Lincolnshire (R.S.W. 17) His Father died only three months before he was born (Sir Isaac Newton 1). When he was three years old Isaacs mother, Hanna, placed him with his grandmother so that she could remarry a man named Barnabas Smith, a wealthy man from North Witham (Dr. Robert A. Hatch 1). When his mother returned to Woolsthorpe in 1653, Newton was withdrawn from school to fulfill his birthright as a farmer. Newton failed at farming, and returned to Kings School at Grantham to prepare for entrance to Trinity College, Cambridge. A turning point in Newtons life was when he left Woolsthorpe for Cambridge University in June of 1661 (Dr. Robert A. Hatch 1). Although Cambridge was a marvelous center of learning, the spirit of the scientific revolution had yet to enter its curriculum. In 1665 Isaac Newton took his bachelors degree at Cambridge without honors or distinction (Dr. Robert A. Hatch 2). In 1665 the university was closed because of the plague. At this time Newton returned to Woolsthorpe. There, in the following 18 months, he began revolutionary advances in mathematics, optics, physics, and astronomy (J. A. Schuster 1). During the plague years, Isaac Newton laid the foundation for elementary differential and integral Calculus. He invented the method of fluxions which was based on his crucial insight that finding the area under its curve is the inverse procedure to finding the slope of the curve at any point (J. A. Schuster 1). Also during the plague years he made remarkable discoveries in optics. He had reached the conclusion that white light is not a simple, homogeneous entity. He proved this by passing a thin beam of sunlight through a glass prism which created a spectrum of colors on the wall opposite. Isaac argued that white light is a mixture of many different types  of rays, that the different types of rays are refracted at slightly different angles, and that each type of ray is responsible for producing a given color (J. A. Schuster 2). Newtons greatest work was in physics and celestial mechanics. In 1666, Newton had formulated early visions of his three laws of motion (J.A. Schuster 3). Also during these years he examined the elements of circular motion and, applying his analysis to the moon and the planets, found the inverse square relation that the radially directed force acting on a planet decreases with the square of its distance from the sun. This was later crucial to the law of universal gravitation (Sir Isaac Newton 3). When the University of Cambridge reopened after the plague in 1667, Newton put himself forward as a candidate for a fellowship (Sir Isaac Newton 3). He was elected to a minor fellowship at Trinity College but, after being awarded his Masters Degree, he was elected to a senior fellowship in 1668. Before he had reached his 27th birthday, he succeeded Isaac Barrow as Lucasian Professor of Mathematics (Dr. Robert A. Hatch 2). In 1672, shortly after his election to the Royal Society, he communicated his first public paper, a controversial study on the nature of color (Sir Isaac Newton 4). The paper was generally well received but Hooke and Huygens objected to Newtons attempt to prove, by experiment alone, that light consists of the motion of small particles rather than waves. Although his hypotheses was not convincing, his ideas about scientific method won universal assent along with his corpuscular theory. These reigned until the wave theory was revived in the early 19th century (Newton, Sir Isaac 2). Newtons relations with Hooke soured. Newton withdrew from public discussion for about a decade. After 1675, he devoted himself to chemical and alchemical researches. He postponed the publication of a full account of his optical researches until after the death of Hooke in 1703. Newtons Opticks appeared in 1704. Newtons Opticks dealt with the theory of light and color and with Newtons investigations of the colors of thin sheets. It also contained Newtons Rings and the phenomenon of diffraction of light  (Newton, Sir Isaac 2). In 1689, Newton was elected to represent Cambridge in Parliament. During his stay in London he became acquainted with John Locke, the famous philosopher, and Nicolas Fatio de Duillier, a brilliant young mathematician who became a friend. In 1693, however, Newton suffered a severe nervous disorder (Dr. Robert A Hatch 4). There are many interpretations to the cause of this disorder. Some of these interpretations include overworked, the stress of controversy, and perhaps mercury poisoning the result of nearly three decades of alchemical research. After his recovery Newton sought a new position in London. In 1696 Newton was appointed Warden and then Master of the Mint (Dr. Robert A. Hatch 4). In 1703, Newton was elected president of the Royal Society and was annually reelected until his death (Dr. Robert A. Hatch 5). In 1705 Isaac Newton was knighted (Margret C. Jacob 390). His time as president has been described as cruel, and his control over the lives and careers of younger disciples was all but absolute. Newton could not stand for contradiction or controversy; his quarrels with Hooke provided a single example. Later disputes, as president of the Royal Society, Newton used all the forces he could muster. An example of this is when he published Flamsteeds astronomical observations without the authors permission. In the end, the actions of the Society were extensions of Newtons will. Until his death Newton dominated the landscape of science without rival (Dr. Robert A. Hatch 5). Issac Newton died in London on March 20, 1727 (R.S.W. 20). In conclusion, Sir Issac Newton was one of the greatest scientists in history. Newton was also the culminating figure in the scientific revolution of the 17th century. Many of his theories have become foundations for many areas of science.

Factors Affecting Buildability of Building Designs

Factors Affecting Buildability of Building Designs Buildability is increasingly become a major requirement in building construction practice. The aim of buildability is use to improve the efficiency of overall building process by developing construction sensitive designs. Nowadays, in Malaysia construction industry, there have facing a lot of problem that will impede the project to process smoothly. In this research, it will highlight what buildability is. Through this we can deeply understand what buildability is and how important it was in the construction industry. Moreover, in this research, we wish to find out and identify the buildability attributes in building design in Malaysia construction industry. There are many buildability attributes have affecting in the building design. If the constructions proceed without a good buildability management, it will bring many problems to the project. So in this research, besides that identifying the buildability attributes, we also wish to find out the importance level for each of these attributes. AIM This report are aim to find out the factors that affect buildability of building design in the Malaysian construction industry. OBJECTIVE In order to achieve the aim of the report, the following are the objectives of this research To study what is buildability and factors may affect it in building design To find out and identify the buildability attributes in building design in the Malaysian construction industry To measure the level of importance of different buildability attributes Research Methodology Literature Review The purpose of the literature review is given us to understanding what buildability in the construction industry is and how important it was. This research methodology may include definitions, ideas and practices of related topics. Besides that, we can study and review to the relevant books, journals, internet and etc., as known as secondary data, that related to the topic buildability. Through those review sources, the important point will be noted down and convenience for us to writing the literature review. The below are showing that the literature search that will be carried out:- Define the definition of buildability/ constructability Define the principle and concept of buildability/ constructability Determine the factor affecting buildability in building design in construction Determine the building attributes and the level of importance for each attribute Questionnaire Questionnaire is recommended as one of the research method, because it is easier for analyzing the data, economical and the hypothesis can be tested. Questionnaire is a research instrument consisting of a series of questions and/or in difference grouping for the purpose of gathering the information from respondents. To gain more information of this research, copies of questionnaire will be sent out to the construction companies and they are needed to express their opinions based on their experience. In this questionnaire, there are empty spaces provide for the respondents to giving their comment or suggest other building attributes which are not included. This questionnaire will target to the professionals such as architect, engineer, project manager, quantity surveyor and others in the contractor industry firm in Malaysia. From the research title, to determine the level of importance of buildability attributes in this research, the classification of the rating scales is used. The questionnaire is based on LIKERT SCALE format. It is a widely used instrument in measuring opinions. A likert item is simply a statement which the respondent is asked to evaluate according to any kind of subjective or objective criteria and generally the level of agreement or disagreement is measured. 5 point likert scale being used as it may produce slightly higher mean scores relative to the highest attainable score. This will be carried out in the final stage of research methodology. The results/ comments get from the respondents will be analyze and present in table or graph in order to provide a clearer view of overall research with writing up the contents of the dissertation. Besides this, analysis and interpretation would be done to gather all the information and data. DISSERTATION ORGANIZATION Chapter 1- Introduction Chapter 1 provides an introduction of the chapter that giving a brief about our proposal. In this chapter it includes introduction/ background, problem statement, aim, objectives, research methodology and working program for the dissertation. Chapter 2 Literature Review Through the review of literature/ articles related to our research topic the important point will be written in this chapter. Journals, books and information from the internet will be the source of the information or data to doing this buildability title dissertation. This chapter are aim to provide a main picture of the knowledge to us before the research is carried out. Chapter 3 Research Design and Methodology Questionnaire will be designed based on the objective and information that we want to find out. These questionnaires will be sent to different construction industry companies in Malaysia to collect data to conduct next step of dissertation. Chapter 4 Data Analysis and Results Discussions The collected information from the respondents will be evaluated and analyzed in table or graph with explanation. Chapter 5 Conclusions This chapter will conclude and recommend the overall results of the survey for further research. REFERENCES Crowther,.P. Design For Buildability and The Deconstruction Consequences, Design for Deconstruction and Materials Reuse, CIB Publication 272. Lam, P.T.I., Wong, F.K.W., Wong, F.W.H. 2007. Building features and site-specific factors affecting buildability in Hong Kong, Journal of Engineering, Design and Technology, Vol 5, No 2. Mydin S.H., Zin R.M., Majid M.Z.A, Zahidi M. and Memon A.H. 2011. Buildability Attributes at Design Phase In Malaysian Building Construction, International Journal of Sustainable Construction Engineering Technology, Vol. 2, Issue 1. Wong, F.W.H, Lam, P.T.I, Chan, E.H.W. and Wong F.K.W. 2006. Factors Affecting Buildability of Building Design, Canadian Journal of Civil Engineering, 33.7, pg 79 CHAPTER 2 LITERATURE REVIEW INTRODUCTION Buildability or constructability has a huge area of study and it was very important in a construction industry. The aim of these literature reviews are to study and highlight the area that the buildability attributes that may affect the building design in Malaysia construction industry. The first reviews that will focus in this chapter are definition of buildability, then coming up with the principles and concepts of buildability which have defined by different countries. Moreover, this review also focuses on the factors that may affect the buildability by identify the buildability attributes in building design. BUILDABILITY/CONSTRUCTABILITY DEFINITION OF BUILDABILITY Since the buildability is important in the construction industry, so there are many researchers from different countries has identified and defined buildability based on their studies. Based on the several articles study and resources, it found that the one of the widely definition that can be accepted which is define by the Construction Industry Research and Information Association (CIRIA), 1983, it stated that the buildability is the extent to which the design of a building facilitates ease of construction, subject to the overall requirements for the completed building (Wong, Lam, Chan and Wong, 2006B.p. 796). Besides the definition defined by CIRIA, there also have another definition which was founded with specific aim of improving the construction total quality management and the overall cost effectiveness and defined as constructability is the effective and timely integration of construction knowledge into the conceptual planning, design, construction and field operation of a project to achieve the overall project objectives in the best possible time and accuracy at the most cost-effective level by Construction Industry Institute (as known as CII) in year 1986 (Wong, et.al, 2006B.p. 796). According to The Construction Industry in Australia (CIIA), Griffith and Sidwell (1997), has defined constructability as a system to integrate if construction knowledge in the project delivery process and balancing the various project and environmental constraints to achieve the project goals and building performance at the optimal level.(Wong, et.al, 2006B.p. 796) Buildability Performance Research Group (BPRG), Chen and McGeorge (1994), defined buildability as the extent to which decisions, made during the whole building procurement process, ultimately facilitate the ease of construction and the quality of the completed project which buildability as a management to goals the project by recognize the factors affected the project (Eng, 2002.p. 117). In the other hand, there are other researchers have derived their own definitions based on their studying in buildability, such as:- Ferguson (1989); buildability was defined as the ability to construct a building efficiently economically and to agreed quality levels from its constituent materials, components and sub-assemblies (Wong, et.al, 2006B.p. 796.) Williams (1982); buildability was defined as the most economic and efficient way of putting a building together.(Yang, 2004) Illingworth (1984); buildability was defined as a design and details which recognize the assembly process in achieving the desired result safety and at least cost to the client.(Yang, 2004) In year 1996, Moore has modified the definition defined by Illingworth as a design philosophy, which is recognizes and addresses the problems of the assembly process in achieving the construction of the design product, both safety and without resort to standardization or project level simplification.(Yang, 2004) Lueprasert (1996), constructability has defined as an important characteristic of structural design and site conditions of construction project which determines the level of complexity of executing the correlative structural assembly tasks.(Yang, 2004) Moreover, there are few researchers believed that constructability are significantly different with buildability. The differences between buildability and constructability are that buildability is a design-oriented concept but constructability is concern the whole project processing. But also have some researchers thought that there are no difference between buildability and constructability, the only is buildability is usually used in UK and constructability is often used in USA. (Yang, 2004) PRINCIPLES AND CONCEPTS OF BUILDABILITY According to Eng, (2002, p. 112), Buildability or Constructability has been used and evolved in the construction management in the late 1970s in United Kingdom, but its potential was not been fully exploited in construction industry at the time. Nowadays, buildability is increasingly become an integral part of the construction industry in many countries because it was a technique used to manage the construction process during the pre-construction stage. According to Low et.al, (2008), buildability aim is to ensure the impacts of design details are recognized and considered in the earlier stage to reduce and/or prevent errors, delays and allows a cost control to the overall project others. Together with this, it will enhance the productivity and competitiveness of the industry. Moreover, Low study also stated the summarized of buildability principles that defined by some researchers such as Adams (1989), Ferguson (1989), Gray (1984), Griffith and Sidwell (1995), Tatum (1987) and other s as shown as below:- Efficiency and economical building production; to ensure efficient and economical production of a building, a logical organization of the sequence of assembly is necessary. The building organization must ensure continuity of construction work by having food management due to labors, machineries and materials delivery to achieve this principle (OConnor, 1985). Simplicity; this principles saying that the designers of the project must try to produce the simplest possible details compatible with the overall requirement for the building especially for the buildings group of elements (Ferguson, 1989; Bishop, 1985). Tolerance Level; the building design should recognize its tolerances which are normally attainable under site conditions. Different the materials and components used on site have its different composition and different jointing methods required. Therefore, practical level of tolerance adopted is necessary for the materials and components (Ferguson, 1989). Innovation; use any innovative ideas that can enhance the buildability of a project. The contractor should try to bring in new machineries or methods of working that can improve the productivity and allow construction process more efficiency. Before bring in the ideas, consideration of the level of skills available in industry is required. (Tatum, 1987). Proper scheduling; a good scheduling of works may allow construction proceed smoothly and right on track. The construction sequence should be practical to allow for a continuous flow of work to minimize delays of works (Gugel and Russell, 1994). Repetition and standardization; to reduce time consuming for constructions, the building elements should be design that encourages appropriate repetition and standardization, it may help to reduce cost, risk and error by using readily and standard items in construction (Adams, 1989; Ferguson, 1989). Participation and communication; project team members with relevant knowledge should be encourage to participate all level of construction. They can give their opinion and suggestion during early planning stage to reduce problem in future. Clear project information should be planned and coordinated to suit the construction process and facilitate the best possible communication and understanding on site (Fischer and Tatum, 1997). Avoid damage by subsequent works; the design should enable the works that carried out will not have risk of damage due to adjacent finished elements and with minimum requirements for special protection. This would reduce the need for return visits to site to repair damage. By doing few times checking to the completed works is better to reduce the project completion period (OConnor and Tucker, 1986). (Source: Low et.al, 2008) McGeorge and Palmer (1997) have identified that buildability and constructability is the only management concept to have been designed and developed by the construction industry (Eng, 2002). This is because they think that the separation of designs and construction processes is unique to the construction industry. Eng also mentioned that the report in early 1960s, division between the process of design and construction was recognized as contributing to inefficiencies throughout the construction industry. (Eng, 2002).Emmerson (1962) has identified that insufficient documentation before tender, inefficient pre-contract design procedures and lacks of communication among the architects, consultants and contractors appointed are the factors that cause the problem occurred (Eng, 2002). Moreover, Banwell, (1964) suggested that the contractor who is too far from the design stage for his specialized knowledge can be participate in traditional contracting situation. (Eng, 2002.p. 111).In the o ther hand, Banwell report also highlighted that the complexities of modern construction and its requirement for specialized techniques demand that the design process and the construction stage should not be regarded as separate fields of activity. (Eng, 2002.p. 111) EVOLUTION OF BUILDABILITY/CONSTRUCTABILITY CONCEPT Through different groups of researchers, a number of stages in the evolution of the buildability or constructability concept are been identified and related to research efforts in different parts (Eng, 2002). According to Eng (2002) study, it shows the groups of researchers from different countries that have evaluated the evolution of buildability/constructability, which are: Construction Industry Research and Information Association (CIRIA); UK Construction Industry Institute (CII); USA Construction Industry Institute of Australia (CIIA) Building Performance Research Group (BPRG); University of Newcastle in Australia In the early research taken by CIRIA and UK researches, they regarded that buildability is problem that arose from the division between builders and designers; led researchers to focus on technical issue and site and construction planning (Gray, 1983; Adam, 1989; Ferguson, 1989). (Eng, 2002.p. 112) Besides that, Eng stated that most industry researchers and commentators are tended to see buildability as a function that is within the influence or control of the designer. Illingworth (1984) has suggested that the problem of buildability was become deteriorate because the designers and professional team are resented contractors involve and giving their opinions during the design stage.(Eng, 2002.p. 112) In addition, CII had used industry case studies to investigate the constructability problem in construction industry to allow the researchers to understanding the issues. This carried out the understanding of different stages of project life cycle which would relate to different issues in constructability (Eng, 2002). Furthermore, CIIA also used the case studies to enable a holistic perspective to be maintained. CIIA have proposed 12 principles would be relevant with different emphases due to the different project life cycle. For BPRG at University of Newcastle in Australia, they started with conceptualize the buildability problem as one that derived from a complex system and they proposed that the concepts of buildability is needed to recognize the factors in a project environment which may affected in the design process, construction process and the link between them (Eng, 2002). CIRIA RESEARCH IN BUILDABILITY The definition of buildability defined by CIRIA has shown at the above. Though that we know that CIRIA definition is focused between designs and construction; the factors has been implied which are solely within the influence or control of the design team those have a significant impact on the ease if construction of a project (Eng, 2002). The concept was recognized as an issue within an integrated design management context. A good buildability are formed based on a building design, structure or other which had been consider in the construction phase with emphasis on the method of construction, activities, sequence of works and way incorporated into the overall design (Eng, 2002). In additional, Eng study had showing the 16 guiding principles for achieving buildability which was identified and developed by Adams (1989), CIRIA, as below:- Investigate thoroughly Consider accessibility at the design stage Consider storage at design stage Design for early enclosure Design for minimum time below ground work Suitable materials use Consider for the local skill available Design for simple assembly Plan for maximize repetition and standardization Maximize the use of plant Allow for sensible tolerances Allow for a practical sequence of operations Plan to avoid change to work Avoid return visits on site; do it right in first time Safe construction design Clearly communication (Source: Adam, (Eng, 2002)) CONSTRUCTABILITY DEVELOPTMENT BY CII According to Eng (2002), has mentioned that CII used case studies to identify different of requirements for the planning stage (Tatum et.al, 1986), engineering and procurement phases of a project (OConnor et.al., 1986) and improvement of constructability that able to make during field operations (OConnor and Davis, 1988). In additional, they had identified and presented 6 concepts for the planning stage, 7 concepts for the design and procurement phase and 1 for field operations phase which showing below:- Conceptual Planning Stage Basic design approaches consider major construction methods Constructability programs are an integral part of project of project implementation plans Project planning requires construction knowledge and experience Early construction involvement in the development of contracting strategy Project schedules are construction sensitive Site layouts show efficient of construction Design and Procurement Stage Design for accessibility, materials and equipment Design for construction in adverse weather and remotes locations Design and procurement schedules are construction sensitive Design to enable efficient construction Design elements are standardize Construction and procurement efficiency are specifications developed Design for modularization to facilitate fabrication/transportation Field Operation Contractors use innovative methods (Source: Tatum et.al; OConnor et.al; OConnor and Davis; (Eng, 2002)) CONSTRUCTABILITY PRINCIPLES BY CIIA For CIIA, they have review to the work of CII, and some developed construction information within the Australian context (Eng, 2002). At the beginning, they are 17 principles are being identified and tested. In the other hand, more than twenty of the personnel who experienced in construction are given feedback due to this tested. Through the test, Constructability Principles File (CIIA, 1992) has shown 12 concepts of constructability to represent current best practice applicable over five projects life cycle stages, which are feasibility studies stage, conceptual design stage, details design stage, construction stage and post construction stage (Eng, 2002). The twelve principles espoused were:- PRINCIPLESÂ  DESCRIPTION Integration Constructability must be made an integral part of project plan. Construction Knowledge Project planning must actively involve construction knowledge and experience. Team Skills Project team must be appropriate for the project based on their experience, skills and etc. Corporate Objectives Project team understanding against clients corporate and project objective to improve constructability. Available Resources Technology use in design solution must be matched with the skills and resources available. External factors External factors might affect the cost and program of the project. Program of project Overall project program must be realistic and have the commitment of the project team. Construction Methodology Construction methodology must be considered in project design. Accessibility Constructability will be improved if accessibility is considered good in the design stage of project. Specifications Constructability improved when efficiency considered in specification development. Construction innovation Constructability improved when innovation techniques is used Feedback Post construction analysis is undertaken to allow constructability can be enhanced on future projects Table Principles by CIIA (Francis and Sidwell (Eng, 2002)) CONSTRUCTABILITY CONCEPTS BY MALAYSIAN RESEARCHER According to Nawi, Kamar, Lee, Hamid, Abdullah, Haron and Ariff (2009), stated that in Malaysia, the constructability and buildability concepts established by the Construction Industry Institute (CII) and other relevant literature by CIRIA, (1983); Tatum, (1987); Adams, (1989); CII, (1993) and etc, there are 23 constructability concepts were formulated and presented by Nima, (2001) which use them to utilize a study in relation to the engineered construction phases. There are 7 concepts for conceptual planning phase, 8 concepts for design and procurement phase and 8 concepts for field operation phases which as follows:- C1-C7 (Project constructability enhancement during conceptual planning phase) Concept C1 the project constructability program should be discussed and documented within the project execution plan, through the participation of all project team members. Concept C2 a project team that includes representatives of the owner, engineer and contractor should be formulated and maintained to take the constructability issue into consideration from the outset of the project and through all of its phases. Concept C3 individuals with current construction knowledge and experience should achieve the early project planning so that interference between design and construction can be avoided. Concept C4 the construction methods should be taken into consideration when choosing the type and the number of contracts required for executing the project. Concept C5 the master project schedule and the construction completion date should be construction-sensitive and should be assigned as early as possible. Concept C6 in order to accomplish the field operations easily and efficiently, major construction methods should be discussed and analyses in-depth as early as possible to direct the design according to these methods. Concept C7 site layout should be studies carefully so that construction, operation and maintenance proceed efficiently and avoid any interference between the operations performed during these phases. C8-C15 (Project constructability enhancement during design and procurement phases) Concept C8 design and procurement schedules should be dictated by construction sequence. Thus, the construction schedule must be discussed and developed prior to the design development and procurement schedule. Concept C9 advanced information technologies are important to any field including field of construction industry. The usage of those technologies could overcome the problem of fragmentation into specialized roles in this field, hence enhancing constructability. Concept C10 designs, with design simplification by designers and design review by qualified construction personnel must be configured to enable efficient construction. Concept C11 project elements should be standardized to an extent that will never affect the project cost negatively. Concept C12 the project technical specifications should be simplified and configured to achieve efficient construction without sacrificing the level or the efficiency of the project performance. Concept C13 the implementation of modularization and preassembly for project elements should be taken into consideration and studied carefully. Modularization and preassembly design should be prepared to facilitate fabrication, transportation and installation. Concept C14 project design should take into consideration the construction personnel, materials and equipment accessibility to the required position on-site. Concept C15 design should facilitate construction during adverse weather conditions. Great emphasis should be made to planning for the construction of the project under suitable weather conditions, but the designer must plan and take into consideration the project elements that could be prefabricated in workshops. C16-C23 (Project constructability enhancement during field operation phases) Concept C16 field task sequencing should be configured in order to minimize damages or rework of some project elements, minimize scaffolding needs, formwork used or congestion of construction personnel, material and equipment. Concept C17 innovation in temporary construction materials/systems, or implementing innovative ways of using available temporary construction materials/systems that have not been defined or limited by the design drawings and technical specifications will contribute positively to the enhancement of constructability. Concept C18 incorporating innovation of new methods in using off-the-shelf hand tools or modification of the available tools or introduction of a new hand tools that may reduce labour intensity, increase mobility, safety or accessibility will enhance constructability at the construction phase. Concept C19 introduction of innovative methods for using the available equipment or modification of the available equipment to increase their productivity will lead to a better constructability. Concept C20 in order to increase the productivity, reduce the need of scaffolding or improve the project constructability under adverse weather conditions, constructors should be encouraged to use any optional preassembly. Concept C21 constructability will be enhanced by encouraging the constructor to carry out innovation of temporary facilities. Concept C22 good contractors, based on quality and time, should be documented, so that contracts for future construction works would not be awarded based on low bits only, but by considering other project attributes. Concept C23 evaluation, documentation and feedback of the issues of the constructability concepts should be maintained throughout the project to be used in later projects as lessons learned. (Source: Nima el al, (Nawi, et.al, 2009)) Although there are many researchers from different countries have identified and presented their own principles and concepts, but the points they covered are almost the same. Through those principles and concepts, it showing the ways to help the construction to reduce its project time, error, cost by having a good buildability on manage overall project. ASSESSMENT OF DESIGNS FOR BUILDABILITY According to CIRC and Chiang et.al, has stated that the construction industries are continues to search out the ways to improve buildability, such as the use of prefabricated, standardized and modular components, as well as the adoption of alternative procurement methods (cited by Wong, Lam, Chan P.C. and Chan H.W., 2006), the Building and Construction Authority (BCA) in Singapore had introduced and published a Code of Practice on Buildabl

Watching A Disappearing Number in Theater Essay -- Simon McBurney

Choose one production that you have seen and which you particularly enjoyed and discuss the aspects which made it so successful. A Disappearing Number I went to see a Disappearing Number, in the Theater. The production was performed by Complicite and was directed by Simon McBurney. I really enjoyed this performance. I thought that the mixture of maths and romance as well as the structure of the performance by incorporating the past and the present together, was extremely successful. The most successful aspect of the performance for me were the scene changes. I found that the rotation of the blackboard, center stage, where the actors were able to stoop beneath it in order to enter and exit the stage, was an effective touch to this non naturalistic performance. When this was first used, at the end of the first scene, when the characters Ruth and Al left the stage, I thought it didn't quite fit as at the beginning the style was leaning towards realism. But as the play progressed and the acting style became more and more non naturalistic, and this rotation of the black board technique was used more frequently it fitted in really well and became really effective. Later on in the performance when Ramanujan and Hardy are introduced, again the scene changes were quick, swift and rapid. Screens were used to conceal the actors as they came on to the stage and then conceal the other actors as they left the stage. The two different scenes which the screens helped to alternate between were Ramanujan, a remarkable mathematician, living in one of the poorest areas of India and the prominent mathematician, G.H Hardy in Cambridge, two people who were in correspondence with each other. Since each of the scenes were short, the use of t... ...was taken away so suddenly. And pain, for moving on. When Al got to the river the projected image of water is repeated. This recurring image from when Ramanujan dies in the past is brought forward into the present storyline making the link between the past and present even stronger. Because this is a repeated image, the water becomes a metaphor for death, the death of Ramanujan and the death of Ruth and her baby. This scene is a peaceful scene even with this metaphor attached. The audience gets to empathise with Al as he lets go of the past and moves on. Imagery is key in this final scene. The sand that each of the characters pour out from various objects, Al pouring from the cremation box and Ramanujan pouring from his tablet, shows the passing of time. A final connection between the two parts to the performance, the past and the present, the key to the whole play.

Strategic Planning in the Airline Industry

Airline Planning Strategic Planning in the Airline Industry a two-day Seminar The Challenge Rapid and intense change in today’s business climate reshapes the fundamental approach to strategic decision-making. New thinking for ways to face the two vital strategy issues – where will the airline be in the future and how to get there – must emerge so that a modern air carrier can leverage its strength and capitalize on opportunities. Creating innovative strategies for the new business paradigm marks a proactive approach to the challenges in the volatile, yet exciting, airline business.Airlines that embrace a dynamic outlook for strategic planning are positioned favorably to prosper financially and operationally in face of uncertainties and complexities in this business. The strategic plan and its components influence every aspect of running a commercial air carrier. As such, it is critical to devise effective strategies and execute them efficiently. Organizational un its depend on clear understanding of the strategic issues so that they can plan accordingly and carry out the responsibilities created by the strategic plan.Strategic planning brings about an opportunity to examine carefully ways that the airline is conducting its business, and finding new methods to do a better job. Designing and delivering the airline’s services in today’s demanding marketplace requires sophisticated coordination between business units of the airline. Strategic planning serves as a mechanism to create a framework for integrating various contributions to deliver the airline’s offerings. Strategy-based planning addresses both the resource allocation and organization structural issues.Developing a business model for the airline based on a strategic analysis of opportunities and requirements form a platform for planning resources going forward. It also responds to: †¢ †¢ †¢ limitations in utilizing resources uncertainties of the fut ure dynamics of the airline business Business Requirements Strategic Management Strategic management is a disciplined yet adaptive endeavor to chart the future of the airline and align the activities of all business units in that direction.This attempt must be flexible, not rigid, so that the roadmap that it creates can be applied in building sensible operating and tactical plans that can incorporate new realities as the future unfolds. The strategy-savvy airlines reap the rewards of performing better while avoiding the detrimental effects of unstructured, undisciplined response to strategic challenges. Over time, only the airlines will survive that can master designing an advanced yet pragmatic strategic planning process.Such a process must encompass all significant considerations for constructing a blueprint of actions and allocating resources for properly executing those actions. CA Advisors 1250 Aviation Avenue Suite 200M San Jose, California 95110 USA Tel: 408-295-7730 Fax: 408 -280-5700 www. ca-advisors. com Gesellschaft fuer Markt und Strategieberatung Sonnenberger Strasse 52 65193 Wiesbaden GERMANY Tel: 0611-37577-39 Fax: 0611-37577-40 www. gms-beratung. com What is the airline trying to achieve? How is the airline going to achieve it? Objectives Strategy Strategic Analyses StructureHow will the airline organize its resources? Business Model Policies What are the operating rules and boundaries? Strategy-based Planning Structured Approach to Strategic Planning Seminar agenda†¦ Day One †¢ Introduction – strategic management perspective – structured approach to strategic planning Day Two †¢ Planning Optimization – allocating resources – developing prioritization †¢ Airline Business – unique features – models and economics †¢ Financial Planning – investment analysis – financing methods †¢ Strategy Development – practical considerations – innovative approaches †¢ Asset Valuation Real Options methodology – managing uncertainties †¢ Strategic Planning Process – components and requirements – execution and evaluation †¢ Integrated Strategic Management – thriving financially – performing operationally Who should attend†¦ This seminar delivers methods and tools for creating innovative strategies and executing strategic plans at both the corporate level and organizational units. Lessons learned can be quickly applied, facilitating the complex process of strategic decision-making. Airline corporate development and strategic planning executives, managers, and analysts directly profit from this seminar.Those responsible for long-range planning of various functional areas, business development, fleet planning, product and service development, corporate finance, treasury and financing, financial and investment analysis, financial planning and budgeting who directly face the challenges in strateg ic planning are the primary audience. Others in scheduling, marketing, and operations, who are impacted by strategic plans, are also encouraged to attend so that they can benefit from understanding the difficult and complex process of developing strategies and implementing strategic decisions that significantly impact the airline.Benefit from experienced leaders†¦ Two experts who combine extensive experience in strategic planning, airline strategies, and market development with knowledge of advanced quantitative planning and management science techniques will present the seminar. Jahan Alamzad Email: jahan. [email  protected] com Jahan Alamzad is president of CA Advisors. He has served as advisor to Applied Decision Analysis (ADA), a unit of Standard & Poor’s Corporate Value Consulting, where he was previously the director of airline practice. (ADA was a wholly owned subsidiary of PricewaterhouseCoopers LLC between 1998 and 2001. ) Mr.Alamzad has been a management cons ultant in the airline and aerospace industries for the past seventeen years. Before his consulting career, he worked at American Airlines and United Airlines. Mr. Alamzad holds a masters in operations research from Stanford University, as well as a masters in industrial and systems engineering from the University of Southern California, and bachelors degrees in civil engineering and electrical engineering from the University of Illinois. He has served on the faculty of the Department of Aviation at San Jose State University, and has collaborated in publishing a textbook entitled Airline Management.Maciej Mazurowicz Email: maciej. [email  protected] de Maciej Mazurowicz is managing partner of Gesellschaft fuer Markt- und Strategieberatung (GMS). Prior to GMS, Mr. Mazurowicz worked at Lufthansa German Airlines in different strategic management positions. At Lufthansa Consulting, he managed a variety of business development projects for airlines worldwide. Mr. Mazurowicz holds a Mast er of Business Administration and bachelors in business from the University of Kiel. His publications include articles on behalf of the German Ministry of Economics concerning product development and management of innovations.About CA Advisors†¦ www. ca-advisors. com CA Advisors is a management consulting firm dedicated to providing state-of-the-art analytical services. By applying powerful and practical tools, the firm helps its client understand their business positions and improve their strategic and operational decisions. To ensure the success of its work, the firm is committed to collaborating closely with its clients, communicating clearly about its approach, and delivering valuable results that are logically sound. For many years, the work of CA Advisors rofessionals has spanned a wide range of projects. The firm has a focused and dedicated practice in the airline industry, with a breath of expertise in aerospace and aviation. The experience of the firm’s professi onals extends from traditional applications in logistics and resource allocation to more innovative applications in strategic planning. GMS is a management consulting company supporting clients in strategic planning and business development. GMS focuses in planning, marketing and sales, and assists clients in developing and implementing business strategies.GMS experts facilitate the evaluation of the business environment, forecast and analysis of market scenarios, and development of organizational structures by applying a wide range of state-of-the-art analytical tools and business methods, resulting in optimized financial and operational performance of clients. GMS ensures efficient project realization through a network of cooperation partners – from complete IT solutions up to personnel training. About GMS†¦ www. gms-beratung. de

Communication Differences In The Cultures of The Middle East essays

Communication Differences In The Cultures of The Middle East essays Throughout the world, many different cultures exist in many different countries. It is important to be aware of the many diverse cultures and customs of these countries when visiting them, or conducting business with people within them. Because of these vast cultural differences, especially involving communication, it is very easy to offend someone without even knowing it. In regards to communication, it is important to be aware of the customs of the country or countries you are interacting with. More specifically, Middle Eastern customs are especially different from ours in the United States. If someone were to visit Atlanta from the Middle East, it would be important to be familiar with the way they communicate, as to not end up in uncomfortable situations for you and your guest. When exploring these differences, it is necessary to first get an idea of how Americans are generally perceived by the foreign world. To many around the world, Americans are friendly, outgoing, and less reserved. We are also perceived to be obnoxious, self centered, loud, and arrogant. Many countries around the world are also much more formal in the way they carry themselves in every-day situations. We are considered to be the exact opposite. Being very informal seems to be a quality that many foreigners seem to think Americans possess. Whether or not these qualities about Americans are true is really not the point. This is a general perception acquired by many around the world, for better or for worse. Therefore, in order to gain a better understanding of other cultures, it is necessary to keep in mind the qualities that are believed to be portrayed by ourselves. Once it is understood how we are perceived, you need to look at the customs of the person who is visiting. Specifically speaking, if someone from Saudi Arabia were to visit Atlanta, you would need to explore their culture. ...

Free Essays on Countdown

COUNTDOWN by, Ben Mikaelsen Setting: Æ’Ã ¦ Crazy Peak, MT Æ’Ã ¦ Dakar, Senegal, Æ’Ã ¦ Endeavor (space shuttle). Main Characters: Æ’Ã ¦ Elliot Schroeder, a 14-year-old boy who goes to space. Æ’Ã ¦ Vincent Ole Tome, a boy about the same age as Elliot who is from Kenya. Æ’Ã ¦ Vincent ¡Ã‚ ¦s father, a Maasai warrior. Æ’Ã ¦ Elliot ¡Ã‚ ¦s father, a rancher. Point of View: Æ’Ã ¦ Narrator Theme: Æ’Ã ¦ I think that there are a few points to this story. One, is that friendship can help you get through a lot of different types of hardships. The second, I think that the author is trying to tell you that you never know when you wake up in the morning, if your going to make a friend for life. Plot: Æ’Ã ¦ Fourteen-year-old Elliot Schroeder has always dreamed of becoming a pilot, but his father expects him to stay on the family's ranch in Montana, when he grows up. Across the world in Kenya, fourteen-year-old Vincent Ole Tome dreams of going to the white man's "wood school," but his dad wants him to be a Maasai warrior. When Elliot wins the nationwide lottery to be NASA's first Junior Astronaut on board the space shuttle, Endeavor. Then he meets another boy, Vincent, from Kenya, a place in West Africa. The boys don ¡Ã‚ ¦t exactly hit it off at first. Then when the shuttle has to make an emergency landing in Dakar, a place on the West Coast of Africa. Then the fly Vincent over to where Elliot has landed and they put their differences aside and become friends. Connection to Coarse Content: Æ’Ã ¦ I think that this, in a way, relates to Patrick Henry ¡Ã‚ ¦s speech, because it has to do with not getting along with people simply because of their cultural differences.... Free Essays on Countdown Free Essays on Countdown COUNTDOWN by, Ben Mikaelsen Setting: Æ’Ã ¦ Crazy Peak, MT Æ’Ã ¦ Dakar, Senegal, Æ’Ã ¦ Endeavor (space shuttle). Main Characters: Æ’Ã ¦ Elliot Schroeder, a 14-year-old boy who goes to space. Æ’Ã ¦ Vincent Ole Tome, a boy about the same age as Elliot who is from Kenya. Æ’Ã ¦ Vincent ¡Ã‚ ¦s father, a Maasai warrior. Æ’Ã ¦ Elliot ¡Ã‚ ¦s father, a rancher. Point of View: Æ’Ã ¦ Narrator Theme: Æ’Ã ¦ I think that there are a few points to this story. One, is that friendship can help you get through a lot of different types of hardships. The second, I think that the author is trying to tell you that you never know when you wake up in the morning, if your going to make a friend for life. Plot: Æ’Ã ¦ Fourteen-year-old Elliot Schroeder has always dreamed of becoming a pilot, but his father expects him to stay on the family's ranch in Montana, when he grows up. Across the world in Kenya, fourteen-year-old Vincent Ole Tome dreams of going to the white man's "wood school," but his dad wants him to be a Maasai warrior. When Elliot wins the nationwide lottery to be NASA's first Junior Astronaut on board the space shuttle, Endeavor. Then he meets another boy, Vincent, from Kenya, a place in West Africa. The boys don ¡Ã‚ ¦t exactly hit it off at first. Then when the shuttle has to make an emergency landing in Dakar, a place on the West Coast of Africa. Then the fly Vincent over to where Elliot has landed and they put their differences aside and become friends. Connection to Coarse Content: Æ’Ã ¦ I think that this, in a way, relates to Patrick Henry ¡Ã‚ ¦s speech, because it has to do with not getting along with people simply because of their cultural differences....

Causes of Corruption Essays

Causes of Corruption Essays Causes of Corruption Essay Causes of Corruption Essay Econ Gov (2008) 9:245–263 DOI 10. 1007/s10101-007-0033-4 O R I G I NA L PA P E R Causes of corruption: a survey of cross-country analyses and extended results Lorenzo Pellegrini  · Reyer Gerlagh Received: 30 September 2005 / Accepted: 20 October 2006 / Published online: 23 February 2007  © Springer-Verlag 2007 Abstract We survey and assess the empirical literature on the sources of corruption Thanks to the improved availability of data, we are able to produce an improved cross-country econometric model to test well-established and more recent hypotheses jointly. We do not ? nd that the common law system, or a past as a British colony predicts corruption. Our results support cultural theories on the causes of corruption, and suggest that a medium-long exposure to uninterrupted democracy is associated with lower corruption levels, while political instability tends to raise corruption. Our results also suggest that the diffusion of newspapers helps to lower corruption levels. Keywords Corruption  · Ethnolinguistic fractionalization  · Democracy  · Political instability JEL classi? ation D72  · H11  · H50  · K42  · O17 L. Pellegrini (B ) Institute of Social Studies (ISS), Kortenaerkade 12, 2518 AX The Hague, The Netherlands e-mail: [emailprotected] nl L. Pellegrini  · R. Gerlagh Institute for Environmental Studies (IVM), Vrije Universiteit Amsterdam, Amsterdam, The Netherlands R. Gerlagh University of Manchester, School of Social Sciences, Economics, Manchester, UK 246 L. Pellegrini, R. Gerlagh 1 Introduction Corruption is a wide spread phenomenon affecting all societies to different degrees, at different times. On the one hand, as corruption scandals have repeatedly shown, bribes are common in all countries notwithstanding differences in income levels and law systems, as they are common in democracies and in dictatorships. Recent scandals over corruption have shown that also supposedly free-from-corruption societies are affected. The ELF scandal demonstrated that corruption was rampant in the management of the French state owned enterprise. 1 The following year, a corruption charge against President Chirac could not be courted because he was shielded by immunity as the head of the state. Also in Germany, the CDU and former Chancellor Helmut Kohl were ? ned for receiving illegal campaign funding. 3 Among Nordic countries (which rank always among the less corrupt in international comparisons), Swedish and Norwegian managers of state owned companies have been found to be involved in bribe-taking. 4 Corruption is not rare even during humanitarian emergencies. According to Transparency Internati onal, an NGO who strives to expose corruption, relief efforts in the aftermath of the South East Asian Tsunami earthquake of 2004 were hampered by corruption. Still, different countries are marked by large differences to the extent of corruption. In some societies, no transaction is ? nalized without corruption having an effect, while in other countries it is considered an exception and rarely tolerated. Figure 1 presents corruption levels worldwide; the ? gure shows that corruption tends to be pervasive especially in developing countries. At the same time, numerous studies have demonstrated the pernicious effects of corrupted practices on- among other things- economic growth, investment, human development and environmental policies. The relevance of corruption for welfare levels requires the understanding of the sources of corruption (and of differences across countries) and the development of policies to address the phenomenon of corruption. Hard evidence of corruption is intrinsically dif? cult to obtain, because of the secrecy surrounding illegal deals, but there are several ways to obtain proxies of the extent of corruption. One such source comes from the pool of international interviews commissioned for the Global Corruption Perception Barometer (Transparency International, 2004). From the barometer, we can see that while around 90% of Brazilians think that petty and grand corruption are ‘very big problems’, around 50% of Finnish interviewees think that petty corruption is ‘no problem at all’ and around 35% think that also grand corruption is no problem. With respect to the personal experiences of individuals with bribery, 1 On the ELF scandal see The Washington Post, Wednesday, February 9, 2000; Page A21. 2 http://archives. cnn. com/2001/WORLD/europe/10/10/chirac. court/. 3 businessweek. com/magazine/content/01_48/b3759151. htm. Corruption Blackens Nordic Region’s Lily-White Image, Agence France Presse, December 4, 2003. 5 transparency. org/pressreleases_archive/2005/faq_tsunami. html#faqti1. Causes of corruption 247 Fig. 1 A higher score (a darker color) indicates higher corruption perception. Our elaboration on data from Kaufmann et al. (2005) we see that more than 50% of Cameroon’s interviewees admit that somebody in their household paid a bribe in the last 12 months, while among Austrian, Canadian, German and Irish interviewees only 1% mentioned exposure to corruption for their households in the last year. Evidence on private ? rms’ expenditures for bribes is available from the World Business Environment Survey 2000. 6 From the executives’ interviews in the survey, we see for example that while more than 90% of Canadian ? rms declare that they did not pay any bribes in the last year, none of the Armenian and Azerbaijani ? rms interviewed declared so. Once we consider the negative effects of corruption on welfare, an obvious research question arises: what is the reason for corruption to be common in some countries while other countries succeed to prevent corruption from hampering their welfare? While theoretical literature on this subject abounds, empirical studies are relatively scarce. Since several indexes of corruption perception have become available over the last few years, it is now possible to test statistically some of the ideas from the theoretical literature. To the knowledge of the authors, the most comprehensive and widely cited econometric analysis of the sources of corruption is a cross-sectional study from Treisman (2000). 7 The study takes into consideration and tests empirically a wide range of theoretical explanations of corruption and ? nds mostly ‘? xed factors’ as the determinants of corruption. That is, the signi? cant explanatory variables are all persistent over time, impossible to change in the short and medium run. The most policy-amenable variable is the ‘exposition to democracy for more than 46 years’. As the sources of corruption are persistent, corruption itself will remain stable over time and can hardly be affected by policies; corrupted countries should 6 See http://info. worldbank. org/governance/wbes/. 7 This relatively recent paper has been already cited in 59 other works according to ISI Web of Science (checked on the 18th September 2005). 248 L. Pellegrini, R. Gerlagh ather learn to live with it. Treisman’s study will be the point of departure of our work. 8 Previous and subsequent empirical studies- mostly cross sectional- have focused more on single issues where the authors have tested a particular theory by inserting a proxy for a speci? c variable into multiple regressions. These studies most often produced results that con? rmed the theories that were tested and, while they are valuable contributions for the identi? cation of likely sources of corruption, they may have over-emphasized the importance of the variables analyzed because of omitted variables biases. Several studies focused on the role of democracy as a determinant of corruption (among the most recent: Sung 2004; Chowdhury 2004 and Bohara et al. 2004), some focused on regulatory burden and economic freedom (Chafuen and Guzman 1999), others have focused on decentralization and federalism (e. g. Fisman and Gatti 2002; Arikan 2004), on natural resources prevalence as a source of income in the economy (Leite and Weidmann 1999), and on legal origins of a country as a determent of corruption (Glaeser and Shleifer 2002). In our paper we will ? rst provide a systematic overview of different theories on the causes of corruption. In this survey, presented in Sect. 2, we distinguish theories that focus on historical roots versus theories that give more attention to contemporary causes. Thereafter, we will assess the different theories and calculate our own estimates of the sources of corruption in a comprehensive econometric model, using indexes of corruption that have become available recently (Kaufmann et al. 2005) and we will cover a large sample of countries. Furthermore, we will make use of some independent variables that are improved proxies for the variables that theory would suggest. The empirical contribution of this paper is threefold. First, due to improved data availability, we can work with a larger data sample that give more power to our statistical tests compared to earlier studies. 9 Second, we have a large set of independent variables available that we can test jointly so that we do not suffer from omitted variable bias, a problem of many previous and partial studies that may have overemphasized the importance of the variables under consideration. This advantage is particularly valuable as it helps us to assess the importance of long-lived versus contemporary causes of corruption, while these sources of corruption have mostly been assessed independently, so far. Thirdly, a crucial advantage over previous authors is the availability of two alternative corruption indexes, which can be used for robustness checks of the ? ndings. Section 3 describes the data that we use for our own econometric analysis, Sect. 4 introduces and discusses the econometric estimates, and Sect. 5 concludes. 8 Lambsdorff 1999 provides a comprehensive survey of earlier empirical results. 9 Speci? cally, when we compare our study to Treisman’s, we ? nd that our sample is larger than 100 countries in most regressions, while Treisman’s sample size is between 44 and 64 countries in the majority of regressions. Causes of corruption 249 2 Theories of corruption’s determinants Theories of corruption’s determinants (and more generally of the quality of government) abound. We will take as a starting point the theories on the sources of corruption that are mentioned in Treisman (2000) and La Porta et al. (1999) as those studies are considered a benchmark in the literature and they provided a powerful battery of empirical tests. To these we will add the most recent ? ndings of empirically backed literature in order to test and build upon their ? ndings. The subsequent econometric estimates will follow a similar approach. 2. 1 Historical roots of corruption Among the theories that relate the history of countries to their present day levels of corruption, legal theories suggest that the kind of law codes that are in place in a country affect the quality of government, including the level of control of corruption. Historically motivated theories trace the effort of property owners to limit the discretionary power of the Crown as the origin of common law legal codes (Glaeser and Shleifer 2002). Furthermore, they suggest that the actions of the independent judiciary system in countries that adopted the British law code will be conductive to lower levels of corruption (for a discussion in depth, see La Porta et al. 1999). Another theory, also based on the historical roots of corruption, is one that sees former British colonies as having a better civil service code due to the in? uence of the British bureaucracy. In this system, the British civil servant is focused on procedural aspects of the law, which enhances the capability of subordinates and judges to challenge hierarchies in order to enforce the law (Treisman 2000). However, as a result of the method with which colonization was imposed upon countries, this positive effect of British colonization can be questioned. Quoting Macaulay (1843/2001)’ the business of a servant of the [East India] Company was simply to wring out of the natives a hundred or two hundred thousand pounds as speedily as possible, that he might return home before his constitution had suffered from the heat, to marry a peer’s daughter, to buy rotten boroughs in Cornwall, and to give balls in St. James’s Square’. 0 If British colonizers were extracting resources, in addition to establishing legal procedures, the effect of colonization on present corruption deserves to be tested. Another hypothesis, which has been put under scrutiny in previous literature, is that Protestant religion, being relatively less hierarchical when compared to other churches and religions (such as the Orthodox and Catholic churches and Muslims), is less prone to tolerance towa rds power abuses and corruption. Furthermore, the Protestant church has traditionally been apart from the state and played a role of opposition to the abuses of the government (Treisman 2000). 0 Macaulay was in India working for the Supreme Council of India and later became a member of the British Parliament. 250 L. Pellegrini, R. Gerlagh Thus this theory suggests that Protestant countries will be less affected by corruption. Also pointing at long-living causes of corruption are those theories that suggest that more ethnically fractionalized countries tend to be more corrupted (Mauro 1995). One root of the link between ethnolinguistic fractionalization and corruption can be existence of alternative af? liations and obedience with respect to the state. Thus, in ethnically divided societies civil servants and politicians would exploit their positions to favor members of their own ethnic group. Another possible explanation for the effect that ethnolinguistic fractionalization would have on corruption is due to the fact that divided societies tend to under-provide public goods and this, in turn, would augment the dependency on special bounds to obtain essential services from the state. 2. 2 Contemporary causes of corruption Another set of theories relates the level of corruption to institutions, economic structures, and the level of development. These theories provide more of an entrance for anti-corruption policy compared to the theories based on historic variables, as there are some policy-amenable factors among the determinants of corruption. To start with, income levels may affect corruption in several ways. Richer countries can be expected to afford better institutions. Furthermore, many variables correlated with income, such as schooling levels, urbanization and access to mass media, are associated with higher development levels and they decrease the tolerance of the polity towards corruption. It may need some development to recognize corruption as a violation of the border between the public and the private sphere. Thus we expect a real income variable to be negatively correlated with corruption, where causality may run in both directions. The rent-seeking literature emphasizes the link between corruption and possibilities for economic agents to gain access to sources of higher-than-average rents, when state intervention prevents free entry (see Rose-Ackerman 1999). In this perspective, the ? ght against corruption is helped with a reduction of non-generic state regulation. Thus, corruption would be associated to the size of government activities (Chafuen and Guzman 1999; Acemoglu and Verdier 2000). On a similar train of thought, openness to trade and increasing supply of foreign products on the domestic market enhances domestic competition, thereby reducing rents and corruption. Conversely, trade-barriers increase the opportunities for earning extra rents by gaining access to trade allowances, stimulating corruption. Natural resources are a common source of high rents, available to those that have obtained the rights for their exploration and extraction. These rents promote activities aiming at in? uencing policy makers who have power on the distribution of exploitation rights, drawing away resources from other productive activities (La Porta et al. 1999). Thus natural resources abundance would be associated to higher corruption, though we cannot take this effect for granted Causes of corruption 251 since revenues from natural resources could also be used in order to produce public goods, decreasing the need to revert to bribing in order to access them. Another strand of the literature considers the relation between social institutions and corruption, starting with democracy. A negative correlation between democracy and corruption is tautological when based on a substantial de? nition of democracy, since corruption favors the interests of the individual, or a minority, as opposed to the interests of the majority. Once we consider democracy from a procedural perspective (free elections and electoral competitions) the association is less straightforward. Most indexes of democracy are based on the procedural aspects of democracy, and revious empirical studies have found contrasting results. Many papers that focus on democracy and employ few control variables ? nd contemporary democracy to decrease corruption levels (e. g. Hill 2003; Chowdhury 2004; Bohara et al. 2004), while more comprehensive studies do not ? nd such a correlation (Treisman 2000). The experience of some Latin American countries suggests that the transition to democrac y did not produce much of a dividend in terms of a reduction in corruption. A telling example is Mexico. Up to 2000, the country was ruled for seven decades by the PRI, known for its cronies and patronage system. Then, for the ? rst time, a president was elected that was not from the PRI. This was considered a turning point for Mexican democracy, but the following years were marked by corruption scandals that affected virtually all political parties, including the ruling party (the PAN, which has gained power on its platform promoting change and a ? ght against corruption),11 the former ruling party PRI, the other opposition party (the PRD)12 and even the marginal ecologist party. 3 Also in Europe, cases of corruption in long-established democracies abound; the above-mentioned high-level scandals in France are one example. As another example, Italy scores very high on all indexes of corruption, despite having been a democracy with high levels of electoral competition for six decades. Looking at democracy, not from a procedural but from a dynamics point of view, leads us to political sta bility as another variable that may affect corruption levels. In politically stable administrations, bureaucrats face less chances of dismissal and have more opportunity for long-run advancement in their careers, which provides an incentive to build an open and honest reputation for a career development. On the other hand, a permanent position in power may help maintain ‘patronage and corruption’ reputations and relations. There are therefore two alternative and contradictory hypotheses on whether corruption is discouraged or fostered by political stability (Treisman 2000). Apart from the duration of a job in the administration, the wages may also affect the vulnerability to corruption. Higher wages imply higher costs when 11 President Fox has been accused of using illegal funds to ? nance his campaign, see http://news. bbc. co. uk/hi/spanish/latin_america/newsid_2802000/2802161. stm. 12 On the tape-scandals, involving the most important aides of Lopez Obrador, see http://news. bbc. co. uk/hi/spanish/latin_america/newsid_3531000/3531475. stm. 13 On the scandal involving the young leader of the Partido Verde Ecologista, see smas. com/noticierostelevisa/mexico/345598. html. 252 L. Pellegrini, R. Gerlagh a position in the civil service is lost, and a cost-bene? t analysis suggests that higher wages thereby provide an incentive to restrain from corruption (Becker 1968; Treisman 2000). Finally, we look at a rather different institutional variable, recently studied in both theoretical and empirical work: the extent of newspaper circulation, where the press i s supposed to act as a check on those that should represent the public interest (Brunetti and Weder 2003). The hypothesis claims that corruption scandals being freely enquired and exposed by the mass medias, acts as a deterrent for bureaucrats to engage in corruption activities. 3 Data sources on corruption In this section we describe our dataset and the underpinning concept of corruption. The other variables will be described below as they are introduced in the econometric analysis. The variables’ sources are listed in the Appendix together with their descriptive statistics. The assessment of corruption levels across countries is a formidable empirical challenge as corruption is dif? ult to de? ne uniformly, being culturally determined, and even more dif? cult to measure, because illegality implies secrecy. We will use data that complies with the general de? nition of â€Å"abuse of power for personal gains†14 from the World Bank15 (Kaufmann et al. 2005) and Transparency International. 16 The two datasets are similar in the sense that they gather existing measures on the pe rception of corruption, and produce an aggregate index. In this paper, we will use the data from the World Bank in the main analysis and the index from Transparency International as a robustness check. The individual indexes aggregated in order to create the proxies of corruption (or, more precisely of corruption’s perception), range from Gallup’s opinion surveys- where a sample of the polity is asked how common corruption is and at what scale it operates- to surveys of company executives that estimate the share of their companies’ revenues that are spent in bribes. 17 On the one hand, the high correlation of the aggregated indexes, originated from different sources, gives some con? dence on the fact that they are correct proxies for corruption. On the other hand, it should be noted that the de? ition of corruption can be interpreted differently in different cultural contexts and that there can be ‘emotionally driven’ answers to survey: thus, while a corruption scandal is escalating, the interviewees will possibly overrate the level of corruption, just as when the economy is booming interviewees can have a more positive attitude also about the gove rnment and the civil servants. While some of these 14 For an overview of complexities and the evolution in social sciences of the de? nition of corruption see Williams 1999. 15 Available at worldbank. rg/wbi/governance/data. html. 16 Available at icgg. org/. 17 For a full description of all the sources and of the aggregation methodology used by the World Bank, see Kaufmann et al. 2005; for sources and methodology of the Transparency International index, see Lambsdorff 2004. Causes of corruption 253 concerns are taken care of by the way the polls are realized and aggregated, a margin of uncertainty is inevitable (see Kaufmann et al. 2005). Furthermore, as it has been shown extensively in the empirical literature, even though these indexes may de? e the perception of corruption over its essence, it appears that perceptions have an impact on the economy and that the indexes have a high explanatory power when used as independent variables in econometric analyses (for a review see Jain 2001). Lastly, from the descriptive statistics of Table 2, note that the corruption index has a mean of 0 and a standard deviation of around 1. 18 Thus our results can be easily interpreted in standardized form. 4 Empirical analysis In this section we provide cross-country estimates of the sources of corruption, highlighting where and why our data and results differ from previous studies. Following Treisman’s (2000) methods, we will ? rstly test the hypotheses- already summarized in the previous section- based on the more stable variables and subsequently include variables that can change over time and that can more easily be in? uenced by public policies. Our preferred estimation technique is weighted least squares regressions, where the weights of the estimates are the reciprocal of the margins of errors of the corruption index for each individual observation (as estimated by Kaufmann et al. 005). Thus, the estimates of corruption perception that are more uniform across sources are considered more reliable and get a higher weight in the regressions. 19 The dataset on corruption perception is very extended and includes a number of very small countries with typical features (e. g. having an attractive investment climate) that can easily lead to selection bias in our results. 20 For this reason, we omit from the empirical analysis countries that have less than 1 ,000,000 inhabitants. We begin including as independent variables in our regressions a dummy variable for the common law system, a dummy for British colonies including the UK itself,21 a measure of the percentage of protestants in the population, a measure of ethnolinguistic fractionalization, and a resource abundance 18 The standard deviation is exactly equal to 1 in the complete sample, but because of missing data it changes slightly in each sample. 19 Our results hold also for ordinary least squares estimations, but as expected weighted least squares produce more ‘precise’ estimates (i. e. lightly higher t statistics). 20 One example of the special features that very small countries have is the more limited extent of ethnoguistic fractionalization and the fact that they tend to be more open to trade (e. g. Knack and Azfar 2003). Since small countries are included in corruption surveys only when they are more interesting for investors, the over-representation of small countries with good in vestment climate and low corruption levels could easily introduce in the sample a spurious correlation between corruption, openness (negative) and ethnolinguistic fractionalization (positive). 1 Being a former-British colony should affect the degree of corruption because of the lasting effect British occupation has on the organization of the civil service. The UK has that same civil service organization and this is the reason for including the UK together with its former colonies in the dummy. 254 L. Pellegrini, R. Gerlagh measure based on the percentage of fuels, metals, and minerals in exports. These variables are predetermined by the history of the country or by natural characteristics and can be considered ? xed over long time scales. The dependent variable is the corruption index from the World Bank for the year 2004. The results are reported in Table 1. In regression (1), we ? nd results that throw some doubt on many conventional ? ndings. Speci? cally, while as in most previous analysis we do ? nd a strong correlation with some of the country ? xed factors, we ? nd that neither the existence of a common law system or having been a British colony are aspects associated with a country’s corruption levels. This result challenges the hypothesis that having adopted the British law system or having a past as a British colony reduces corruption at present day (e. . Treisman 2000; Glaeser and Shleifer 2002). When we compare Treisman’s work, where he found a British colonial past to be an important determinant of present levels of perceived corruption, with the model and variables used in this study, we ? nd that our dataset is largely expanded (there are up to 107 countries in our regressions, almost doub le the number of countries in the largest dataset from Treisman) and that the index of corruption we are using has a lower standard error associated with it. 22 We ascribe our ? ding to the fact that our dataset includes countries that were not included in previous studies, are former British colonies, and are also perceived to be very corrupt. 23 As a British colonial past tends to overlap with the Common law system,24 collinearity is a risk in considering these highly correlated variables, and we also include them separately in the regressions. 25 We still ? nd the two variables to be individually non-signi? cant. In our analysis, one factor that signi? cantly affects the level of corruption in all regressions with suf? iently large sample size is the percentage of Protestants in the population, which is negatively associated with the level of perceived corruption. This ? nding relates to the theories of culture and the work of those (Weber and Landes 1999 among others) that sugge st that religion is a fundamental character shaping culture. The in? uence of the presence of Protestants over corruption is con? rmed over the different speci? cations and is always statistically very signi? cant. It must be noted that, from regression (2) to (9), the introduction of other independent variables more than halves the coef? ient of Protestant religion prevalence. The conversion of 20% of the population from a non-protestant religion to the protestant religion (a one standard deviation 22 For a thorough comparison of the corruption perception index from Transparency International and the one from the World Bank, see Kaufmann et al. 2005. 23 Our dataset includes former British colonies such as Myanmar and Sudan, which rank among the countries where corruption is perceived to be the highest in the world. Data on these countries has only recently become available. 4 The list of countries, in our dataset, that experienced British control, but did not adopt the British lega l system are: Egypt, Iraq, Jordan, Kuwait, Myanmar, Mauritius, and Oman. Countries, included in the dataset, that adopted the British legal system without being colonies are: United Arab Emirates, Liberia, Namibia, Saudi Arabia, Somalia, and Thailand. 25 We also computed the variance in? ator factors, for both variables, which were well below the conventional level of 10. Causes of corruption Table 1 Regressions results (3) (4) (5) (6) (7) (8) (9) (1) (2) ?0. 85 (0. 30) 0. 3(0. 23) ? 0. 45(0. 51) ? 1. 07 (0. 13) ? 0. 08(0. 27) 0. 03(0. 29) ? 0. 37 ? ?(0. 17) ? 0. 35 ? ?(0. 17) ? 0. 12 (0. 05) ? 0. 71 (0. 08) ? 0. 64 (0. 08) 0. 41 ? (0. 23) 0. 40 ? (0. 21) 0. 40 ? (0. 22) ? 0. 55 (0. 09) ?1. 10 (0. 25) ? 0. 11(0. 21) ?0. 91 (0. 24) ? 0. 13(0. 21) ?0. 73 (0. 25) ? 0. 18(0. 20) ?0. 60 ? (0. 31) ? 0. 16(0. 21) 0. 44 ? (0. 22) ? 0. 53 (0. 09) ?0. 82 ? ?(0. 37) 0. 08(0. 22) 0. 52 ? (0. 29) ? 0. 67 (0. 11) ?0. 39 ? ?(0. 18) ? 0. 15 ? ?(0. 07) 0. 03(0. 08) 1. 29 (0. 43) ?0. 34 ? (0. 19) ? 0 . 08(0. 10) Common law ? 0. 13(0. 2) British colony ? 0. 15(0. 28) Protestants ? 2. 06 (0. 35) ? 2. 21 (0. 34) ? 1. 10 (0. 25) Ethnolinguistic 1. 53 (0. 30) 1. 36 (0. 22) ? 0. 13(0. 21) fractionalization Fuels and minerals 0. 82 (0. 26) 0. 85 (0. 23) 0. 41 ? ?(0. 21) Imports ? 0. 60(0. 47) Income ? 0. 72 (0. 06) Decentralization Contemporary democracy 30 Years of uninterrupted democracy Newspaper circulation Government intervention Political instability Government wage 0. 41 0. 44 0. 77 R2 Number of cases 106 107 106 0. 89 42 0. 78 104 0. 79 106 0. 80 104 0. 81 103 1. 66 (0. 45) ? 0. 04(0. 03) 0. 85 72 WLS estimation with the Corruption Perception as dependent variable and the reciprocal of errors’ estimates as weights. The constants are included in the regressions, but the coef? cients are omitted in the table. Robust standard errors, are in parenthesis under the coef? cients. The variance in? ation factor is lower than 10 for every variable (indicating that collinerity is not a major problem) *, **, ***Correspond to a 10, 5, 1% of signi? cance, respectively 255 256 L. Pellegrini, R. Gerlagh change) would be associated with a reduction in the corruption index by 0. 2 points on an approximate 0–4 scale, that is one ? th of a standard deviation. Associating the prevalence of fuels and minerals with corruption is not a new concept. In an in? uential paper, Leite and Weidmann (1999) found that corruption levels are statistically associated with natural resources and provide a rent-seeking explanation. When compared to their analysis, our substantially expanded dataset st ill ? nds the same association, though the relation is not as strong as in their results. Thus, in our model, a change of 25% in the value of natural resources on exports (i. e. a one standard deviation change) would be associated with a change of 0. 0 points in our corruption perception index. In regression (2) we include, as a proxy for openness, the share of imports in GDP averaged over of a period of 10 years. We ? nd it not to be a signi? cant predictor of the corruption index. This result differs from Treisman who found imports over GDP to be associated with a decrease of the corruption index, but it corresponds with the results from Knack and Azfar (2003) who have disputed the link between trade intensity and corruption. The difference between results can be ascribed to the propensity of smaller datasets to be affected by selection bias. That is, earlier and less comprehensive surveys tended to include small economies only when they were of interest for international investors who are the main source of funding for the surveys. The selection thus favored small countries that were open and not very corrupt. The inclusion of income as an independent variable in Regression (3), causes some major changes in all coef? cients. 26 Most notably, the ethnic division proxy becomes insigni? cant (and remains insigni? cant after the inclusion of other explanatory variables). It appears that ethnic diversity is not correlated per se with corruption, but through lower income levels or through other variables correlated to income, such as schooling. A similar effect occurs for the coef? cients of the Protestants variable and of natural resources in exports, though these coef? cients remain signi? cant. 27 At the same time, we must emphasize that the inclusion of income as a independent variable runs the risk of creating an endogeneity problem: since corruption, and institutions in general, have been found to affect the growth rate of income, and since institutional quality tends to be stable over time, it is ossible that corruption determines income levels rather than the other way around. 28 A possible strategy for tackling the issue of endogenity is the use of 26 The income variable refers to 2001. 27 Indeed, for natural resources there is a large literature on the ‘resource curse’ and the ‘Dutch disease’, which have shown the de trimental effect that natural resources have on economic growth (Stevens 2003). 28 On the direction of causality between institutions and income there is a large and growing empirical literature. Most of the authors seem to agree that causality runs from institutions to income, rather than the other way around (e. . Rodrik et al. 2004; Acemoglu et al. 2001). For an example of an econometric study ? nding the opposite direction in the causality between growth and institutions, see Chong and Calderon 2000. Causes of corruption 257 instrumental variables. We identify latitude as a good instrumental variable29 (it is correlated with income at 60% and we ? nd no ways through which it could directly affect corruption). Latitude has been suggested as a determinant of income by the proponent of theories of geography as a determinant of economic development (e. g. Sachs 2001). Once latitude is inserted among the independent variables, acting as an instrument for income, the coef? cients of the other independent variables tend to increase in magnitude and to become more statistically signi? cant (not shown in this paper). Most notably, the variables describing democracy, newspapers circulation and political instability (see below) increase their coef? cients. But, equally important, we do not ? nd any of the variables that we found not to be signi? cant in the main analysis to become signi? cant when using the instrument. 0,31 While the income endogeneity issue can be taken care of via the use of instrumental variables, we prefer an alternative solution, using a lagged income variable. The reason is that we are not so much interested in the coef? cient of income itself, which can be biased due to endogeneity, but we are more interested in the use of income as a control variable. Our aim is to ? lter out that part of the coef? cients for other independent va riables that may go through income. We thus use income to improve the robustness of our estimates. Summing up, choosing to present results from the WLS regressions we favor type I errors, but the difference with the results with the instrumental variables would not alter substantially our conclusions. One of the main ? ndings of Treisman (2000) that contradicts existing literature (e. g. Fisman and Gatti 2002) is the trend for federalism to increase corruption. We use as a proxy of power decentralization the share of expenses that are delegated to local authorities as compared to the central government. 32 Once we include such a proxy in our regressions, we do not ? d that decentralization has a positive correlation with corruption. On the contrary, we ? nd the proxy for decentralization to have a negative correlation with corruption, though the coef? cient is not statistically signi? cant. We interpret this result as a 29 A good instrumental variable must be highly correlated with the variable to be instrumented and should not have additional explanatory power. 30 The only except ion is contemporary democracy that becomes signi? cant. In the analysis below, we prefer to use and discuss the measure of medium-term persistence of democracy, because it is signi? ant even with the inclusion of income. In any case, the null hypothesis of exogeneity is not rejected by the Hausman test. 31 A note of caution is needed when we analyze the results with the instrumental variable, because theories that link geographical factors to institutions and through them to income levels have been developed (Hall and Jones 1999; Acemoglu et al. 2001). If these theories are correct, latitude could be used as an instrumental variable for corruption as well, and the interpretation of the 2-stage results would become problematic. For our own dataset, we checked whether latitude could be used as an instrument for corruption in a regression on income and found that latitude would not be a valid instrument, because it retained explanatory power when added to corruption in the regression. 32 Unfortunately, our proxy for decentralization is available just for a small sample of countries. Once more statistics on government ? nance, uniform across countries, are available a more reliable empirical test of the link between decentralization and corruption will be possible. 258 L. Pellegrini, R. Gerlagh weak suggestion that federalism does not increase corruption. 3 One reason for the difference between our ? ndings and Treisman (2000) ? nding can lay in the fact that Treisman uses a dummy variable to characterize a state as federalist or centralist based on an incomplete list of federal countries in Elazar 1995. Apart from its incompleteness, another problem of this list is that an of? cially federalist country may in fact be overly centralized, where Mexico is a case in point. 34 The evidence is less than conclusive, as it is based on a sample of only 42 countries, but deserves to be mentioned as a matter that merits further inquiry (see also Arikan 2004). In the remaining regressions, the decentralization proxy is omitted in order to keep a larger sample of countries. The inclusion of a contemporary democracy variable in regression (4) does not produce a signi? cant coef? cient. This result is different when compared to most of the literature that speci? cally tests the democracy hypothesis. We conjecture that the reason for this is that most other models work with less control variables (e. g. Hill 2003; Chowdhury 2004) or with smaller samples (Sandholtz et al. 2000) leading to omitted variable bias. In the table, we introduced a proxy for democracy from the Polity IV dataset (measuring democratic levels of institutions as judged by a panel of experts, averaged over the period 1994–2003). As an alternative (not reported in the Table), we used a proxy from the Polyarchy dataset (measuring participation and competition at the elections through a mathematical interpretation of elections results, also for the period 1994–2003). None of the two democracy’s proxies seem to affect the corruption level, but only when we exclude the income variable. Thus, it is possible that there is an indirect effect of democracy levels through income on corruption (see Barro 1996; and the literature that has sprung from his work). Constructing a dummy variable for stable democracies35 (where there are no coups, or other major interruptions of the nature of the government, and the country has democratic institutions in terms both of elections and of administration of power), we ? nd that a long exposition to democracy has a mitigating effect on corruption. Thus, a ‘30 years of uninterrupted democracy’ variable [as reported in regression (6)] is signi? ant at 5%. The absolute size and the statistical signi? cance of the coef? cient increases if more decades are included in the dummy. A dummy characterizing countries that experienced 50 years of uninterrupted democracy is signi? cant at 1%. Our ? nding thereby presents 33 To be sure, we also included, as a proxy of the size of the country, the natural logarithm of the population (as in Fisman and Gatti 2002), to account for the fact that countries with different size may have different ‘natural’ centralization levels. Conform with previous literature, we did not ? nd the variable to be signi? cant or to affect the coef? cient of the decentralization variable. 34 In the United States of Mexico, central government spending exceeds the States and the local governments spending together by more than three times. While the Mexican constitution is of federal nature, political power is centralised in the country’s capital. ‘For most of the seven decades of rule by the Institutional Revolutionary Party (PRI), Mexico was a highly centralised one-party polity. State governors, and even many mayors, were named by the president and answered to him, even if they were duly elected, by fraud if need be’, see ‘Mexico’s truncated moves towards real federalism’, March 27th 2003, From The Economist print edition. 35 We set the cut off point at the level of seven on a 0–10 scale of democracy in the Polity IV variable. Causes of corruption 259 an intermediate position where it is not contemporary levels of democracy that are signi? cant predictor of corruption (e. g. Chowdhury 2004), but it is also unnecessary to have 45 years of uninterrupted democracy as in Treisman (2000). According to our estimates, more than 10, but less then 45 years of a persistently democratic regime is suf? cient to produce a signi? cant dividend in terms of corruption reduction. An issue related to democracy that attracted some attention recently is the role of press. We include the variable of newspapers circulation in order to catch the possible effect of that the mass medias can play in reducing corruption. Our empirical ? nding [regression (7)] supports the hypothesis that countries where access to press is more wide spread will have less corruption. 6 There are ? nally the theories related to government policies. Thus, we have included in regressions (8) and (9) an index of government intervention in the economy, a proxy of political instability, and a measure of wages in the public sector. The proxy for government intervention in the economy is computed using government consumption as a percentage of the economy, government ownership of businesses and industries, the share of government revenues from state-owned enterprises, and government ownership of property and economic output produced by the government. While we do not ? nd support for the hypothesis that government intervention is associated with corruption, we are cautious as to its interpretation, because an increase in government activities in the economy can refer to both restrictions that provide more opportunities for rents’ appropriation, but it can also refer to higher expenditures in education and health, or in public goods in general. These in turn could be channels through which corruption is diminished. The political instability is obtained averaging the number of â€Å"veto players† changes in the political system in each year. The variable we employ is a proxy of political instability that recognizing the diffuse nature of political power in most countries. It computes the total number of veto players in the political structure and then evaluates the number of them that have changed in a year. The results show that political instability seems to be signi? cantly associated with corruption, thus the shortening of the time horizons of politicians would affect corruption levels. While evidence of this relation is tentative and would deserve further testing, we highlight that this result is mostly due to the increase in sample size and the use of a better proxy for political instability as compared to Treisman’s work. 37 Finally, we add government wage as an independent variable. We add this government-related variable last, because of the fact that the variable is available only for a reduced sample (72 countries). The government wage is obtained 36 We also checked whether the interaction term between contemporary democracy and newspapers circulation would be igni? cant, controlling whether a free press together with a democratic regime would have a special effect on corruption levels. In our regressions the interaction term was not signi? cant. 37 Treisman employed a variable that simply stated the number of government leaders changes in each year. 260 L. Pellegrini, R. Gerlagh by dividing the average wage in the public sector by GDP per capita. The government wage variable has the predicted negative sign, but is signi? cant only at 12%. Since the sample is relatively small, it is possible that with more data on government salaries and a better proxy for the opportunity costs faced by civil servants if they loose their jobs it would be possible to get a signi? cant coef? cient. 38 As a robustness check of our ? ndings, we have run ordinary least squares regressions with identical speci? cations, only with the Transparency International’s corruption perception index for 2004 as a dependent variable. 39 We ? nd similar results, but with a slightly smaller dataset and decreased signi? ance of most coef? cients. 40 There are two differences in the estimates. First, the share of fuels and minerals in exports tends to become statistically insigni? cant in most regressions, and second, the import share in GDP is signi? cant when income is excluded as an independent variable. Subsequently, we used the corruption perception index of the World Bank for the years 1996, 1998, 2000, and 2002 instead of 2004 as a dependent variable to check our results, with the independent variables also referring to earlier years than in our main analysis. Again, results are similar with two exceptions. Fuels and minerals in exports tend to be slightly more signi? cant in some regressions, and newspapers circulation tends to be slightly less signi? cant in some (other) regressions. 5 Discussion and conclusions Our exercise contributes to the existing literature as it questions some central ? ndings of previous econometric studies. Most notably, for some historical characteristics of a country that have been said to be a cause of corruption, we do not ? nd support. In our statistical analysis we do not ? d that the common law system or a past as a British colony (negatively) predict corruption. Furthermore, we do not ? nd any association between decentralization and corruption. Moreover, the link between ethnolinguistic fractionalization and corruption is diminished and becomes insigni? cant once income is included in the regressions. We do ? nd systematic evidence that supports cultural theories of the causes of corruption, in that the presence of Protestants in the population is found to be associated with lower corruption. We also ? nd that richer countries are less corrupt. As mentioned above, caution is needed as there could be reverse causality from institutional quality to income, though the result is upheld using an 38 A better proxy would be the ratio of civil servants pay to service or manufacturing salaries (that are not in? uenced by the share of population employed in the agricultural sector). Van Rijckeghem and Weder (2001) use the ratio of government wages to manufacturing wages and ? nd it to be a signi? cant determinant of corruption levels. Their data sample, though, is limited to 31 countries and data limitations do not allow us to follow their data. 9 The estimates if Transparency International’s margins of error have been shown to be biased (Kaufmann et al. 2005), therefore we preferred the ordinary least squares, as a regression technique, rather than the weighted least squares technique. 40 The sample size ranges between 98 and 67 countries. Causes of corruption 261 instrumental variable. Another ? nding shows that a long expos ure (30 years) to uninterrupted democracy is associated with lower corruption, that political instability tends to raise corruption, and that the diffusion of newspapers is associated with lower corruption levels. Finally, we also ? d some evidence of an association of higher wages in the public sector with lower corruption. What distinguishes our study from previous econometric works is, apart for some different variable choices, a larger sample and we suggest that the most notable differences with earlier studies can be traced to the inclusion of new countries in the present study. We are aware of the limitations on the interpretation of econometric results. Econometrics has a bias towards theories that can easily be quanti? ed. Case studies and more theoretical studies can act as a necessary complement of this type of work (e. g. Johnston 2005). For future research, we hope to follow two approaches. First, we want to investigate determinants of corruption that are amenable to policy changes. This search can be enhanced through the use of econometric analyses that identify the sources of corruption at the micro level (e. g. Fisman and Miguel 2006; Miller 2006; Reinikka and Svensson 2006). Second, we consider another relevant challenge to be the collection of suf? cient data for a panel data approach over a number of decades. The combined cross-country- or cross-region- and intertemporal analyses possible with panel data can be a key to ? ding other sources of corruption. Acknowledgments The research has been funded by the Dutch National Science Foundation (NWO) under contract no. 016. 005. 040. Appendix Table 2 Descriptive statistics Variables Corruption Protestants Ethnolinguistic fractionalization Fuels and minerals Imports Income [ln(GDP) per capita] Decentralization Contemporary democracy Newspapers circul ation Government intervention Instability Government wage Obs 106 106 106 106 105 106 42 104 104 106 105 73 Mean 0. 00 0. 13 0. 33 0. 20 0. 39 8. 38 0. 33 0. 72 1. 10 2. 94 0. 14 3. 25 Std. Dev. 1. 07 0. 21 0. 30 0. 6 0. 20 1. 19 0. 28 0. 29 1. 48 0. 75 0. 10 2. 47 Min ? 2. 47 0. 00 0. 00 0. 00 0. 09 6. 20 0. 02 0. 05 0. 00 1. 50 0. 00 0. 60 Max 1. 55 0. 98 0. 89 0. 97 1. 34 10. 39 1. 33 1. 00 7. 60 4. 70 0. 41 11. 80 Corruption is the perceived corruption index 2004, from the World Bank (see Kaufmann et al. 2005); Protestants is the share of Protestants in the population, Ethnolinguistic fractionalization is a average of ? ve different indexes based on linguistic groups (for the last two variables see La Porta et al. 1999); Fuels and minerals equals to the share of fuels and minerals on exports, 62 L. Pellegrini, R. Gerlagh averaged over 1993–2002, Income in the natural logarithm of GDP per capita in 2001, (the last two variables are from the World Development Indicators 200 4); Decentralization is the expenses of state and local government divided by the central government averaged over 1993–2002 (from the ‘Government Finance Statistics 2004’ of the International Monetary Fund); Contemporary Democracy is the average of the institutional democracy score for the years 1994–2003 from the Polity IV dataset (see Jaggers et al. ; Newspapers Circulation is daily newspapers circulation for 10 people; Imports is a measure of the openness of the economy and equals to the share of imports over GDP, averaged over 1993–2002 (the last two variables are from the World Development Indicators 2004); Government Intervention is an index for 2004 of the in? ence of government on the economy based on government consumption as a percentage of the economy, government ownership of businesses and industries, the share of government revenues from state-owned enterprises, and government ownership of property and economic output produced by the g overnment (from The Index of Economic Freedom 2005); Instability is the percentage of veto players that changed every year, averaged for 1991–2000 (see Beck et al. 000); Government Wage is the average government wage as a multiple of GDP per capita (from Schiavo-Campo 1998); British Colony is the dummy variable for countries that have been under British control (from Treisman 2000 augmented with information from Flags of the World Website http://? agspot. net/? ags/gbcolon. html); Common Law is the dummy variable for countries that adopted the common law system in their commerical code (from La Porta et al. 1999). 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