Corruption Perceptions Index

The Corruption Perceptions Index (CPI) is an index published annually by Transparency International since 1995 which ranks countries 'by their perceived levels of public sector corruption, as determined by expert assessments and opinion surveys.' The CPI generally defines corruption as 'the misuse of public power for private benefit'. The Corruption Perceptions Index (CPI) is an index published annually by Transparency International since 1995 which ranks countries 'by their perceived levels of public sector corruption, as determined by expert assessments and opinion surveys.' The CPI generally defines corruption as 'the misuse of public power for private benefit'. The CPI currently ranks 176 countries 'on a scale from 100 (very clean) to 0 (highly corrupt)'. Denmark and New Zealand are perceived as the least corrupt countries in the world, ranking consistently high among international financial transparency, while the most perceived corrupt country in the world is Somalia, ranking at 9-10 out of 100 since 2017. Transparency International commissioned the University of Passau's Johann Graf Lambsdorff to produce the CPI.The 2012 CPI takes into account 16 different surveys and assessments from 12 different institutions. The 13 surveys/assessments are either business people opinion surveys or performance assessments from a group of analysts. Early CPIs used public opinion surveys. The institutions are: Countries need to be evaluated by at least three sources to appear in the CPI. The CPI measures perception of corruption due to the difficulty of measuring absolute levels of corruption. A study published in 2002 found a 'very strong significant correlation' between the Corruption Perceptions Index and two other proxies for corruption: black market activity and overabundance of regulation. All three metrics also had a highly significant correlation with real gross domestic product per capita (RGDP/Cap); the Corruption Perceptions Index correlation with RGDP/Cap was the strongest, explaining over three fourths of the variance. (Note that a lower index on this scale reflects greater corruption, so that countries with higher RGDPs generally had less corruption.) Research papers published in 2007 and 2008 examined the economic consequences of corruption perception, as defined by the CPI. The researchers found a correlation between a higher CPI and higher long-term economic growth, as well as an increase in GDP growth of 1.7% for every unit increase in a country's CPI score. Also shown was a power-law dependence linking higher CPI score to higher rates of foreign investment in a country.