Corruption and National Development in Health and Education in Asian Countries

1. Corruption and National Development in Health and Education in Asian Countries Marion M. Valencia

2. Conceptual Background • Welfare state theory • Paradigm 1: The Politics/Administration Dichotomy, 1900-1926 (Henry, 1975)/ and the Neo Bureaucratic Model (Frederickson, 1976) Efficiency in the relationship of government spending and development outcome • Relationship between government spending and development output as interacted by governance • public spending efficiency on education and health as interacted by governance situated in the realm of development studies

3. Empirical Background • Asian countries ranked by the 2010 Human Development Index as Medium Human Development and Low Human Development over the period of 1998 to 2009

4. Main Problem • How corruption interacts in the relationship between public spending on health and education with development output based on the experiences of each of the Asian countries ranked by the 2010 Human Development Index as Medium Human Development and Low Human Development from over the period of 1998 to 2009?

5. Sub problems • Is there a significant relationship between public spending on education with the corresponding development outcome? • Is there a significant relationship between public spending on education with corruption? • Is there a significant relationship between public spending on health with the corresponding development outcome? • Is there a significant relationship between public spending on health and corruption?

6. Hypotheses • H1: There is no significant relationship between public spending on education and the corresponding development outcome. • H2: There is no significant relationship between public spending on education and corruption. • H3: There is no significant relationship between public spending on health and the corresponding development outcome. • H4: There is no significant relationship between public spending on health corruption

7. Significance • The theoretical contribution of this research aims to provide an empirical validation on the interplay of governance in terms of corruption with the relationship of public spending with development outcome • The policy value provided by this study aspires to make available the baseline data for a country under consideration. This will then facilitate the determination on how corruption affects the efficacy in the public spending impact on development outcome on health and education

8. Data • Human Development Index (HDI) - 2010 Rankings, • World Development Indicators from the World Bank database, • and Worldwide Governance Indicators.

9. Model • The independent variables used in this study are public spending on education and health while the dependent variables are the corresponding development outputs on education and health. The other variable that interacts with such relationship is corruption. • The study models the interplay of corruption in the relationship of public spending on health and education with development output by the test of association using Pearson’s correlation. • The interpretation of the analysis of data used 95% confidence interval.

10. Model • The major concepts of Public Spending on Education, and Health; Development Output in Education, and Health; and Corruption are provided with their corresponding indicators. • Public spending on education, total for public spending on primary education; and Primary completion rate for development output in education; • Health expenditure, public for public spending on health; and Mortality rate, under 5 for development output in health; • Control of corruption for corruption.

11. Results: Central and South Asia

13. Conclusion • Hypothesis 1 is rejected by India in the South, and Cambodia in the Southeast. • Hypothesis 2 is rejected by Kyrgyzstan in the Central, and Laos in the Southeast. • Hypothesis 3 is rejected by Turkmenistan and Afghanistan in the Central; Pakistan and Maldives in the South; Thailand, Laos, Philippines, and Indonesia in the Southeast; and Yemen in the Southwest. • Hypothesis 4 is rejected by Laos and Timor-Leste in the Southeast; and Yemen in the Southwest.

14. Implication • The relationship between government spending on health and its corresponding output as intervened by corruption is validated in the test of significance in Yemen and Laos. • Such validation amplifies the theoretical orientation of the studies of Rajkumar and Swaroop (2008) and Baldacci, Clements, Gupta, and Cui (2008). • Drawing the theoretical implication of the results of this study, its validation endows empirical support on the theoretical claims of Paradigm 1: The Politics/Administration Dichotomy, 1900-1926 (Henry, 1975) and the Neo Bureaucratic Model (Frederickson, 1976), • and in general, the role of the state in development explored in the study of Tamura (2003).

15. Implication • The practical implication of the study provides baseline for countries under consideration in determining the effect of public spending in education and health on their corresponding development outputs, and how corruption intervenes in the said relationship. • The baseline provided could then be used as a reference for policy making in an attempt to control or mitigate the impacts and effects of one variable with the other.