The costs of such corruption for overall business development are large. Grand corruption poses somewhat different problems. A survey of enterprises shows that in those economies transitioning from communism where grand corruption is more prevalent, the growth and investment rate of enterprises is much smaller, and the security of property rights is seriously impaired. At the same time, for a number of countries in the former Soviet Union, the survey finds that firms that purchased parliamentary laws, presidential decrees and influence in central banks do themselves benefit in the short run, though grand corruption imposes a particularly pernicious social cost on enterprise development. Leaky governments Empirical studies of the causes of corruption are fairly new.
Evidence suggests it is a symptom of deep institutional weaknesses.
Evidence supports a link between strong civil society and effective strategies for addressing corruption. Evidence from transition economies suggests that the capture of state policies and laws by corporate interests is associated with an absence of full civil liberties. There is also a significant link between corruption and a weak rule of law. Corruption is higher in countries with a high degree of state ownership in the economy, excessive business regulation and taxes, arbitrary application of regulations and trade restrictions. Monopolized economies tend to have more corruption.