Universitas Gadjah Mada
Faculty of Economics and Business

Corruption handling system or Anti-Corruption Law in Indonesia is not rational, so it absolutely does not create deterrent effect for corruptors. It even seems ridiculous when, in fact, Anti-Corruption Act implies to invite people to commit corruption.

Provision in the Anti-Corruption Act states that judges can only sentence maximum fine of 1 billion rupiah to corruptors. "Therefore, if you want profit, just commit corruption in Indonesia. The maximum fine stated above would certainly make people happy to commit corruption in large amount in Indonesia because it will be surely profitable," economist of UGM, Rimawan Pradiptya Ph.D, said on the sidelines of an economic and business behavior seminar at Faculty of Economics and Business UGM on Thursday (22/9).

With irrational system and law, the lecturer added, don’t expect people or society to also act rationally. "Therefore, a massive overhaul to the way of thinking is required if we want to fix the economic system and want to eliminate corruption in this country," he said.

Due to corruption, he said, the state has to bear the loss amounting to 73.07 trillion rupiah from 2001 to 2009. Of this figure, the potential that can be returned only reaches 5.32 trillion rupiah. "It means abiding taxpayers and the community at large must bear 67.75 trillion losses which would not be paid back," Rimawan said.

The revised Law on Anti-Corruption even looks more and more ridiculous when the embezzlement of state funds does not exceed 25 million rupiah, this does not constitute a criminal act of corruption. In previous Act, the limitation did not exceed 5 million rupiah. "People were definitely going to think to steal the state’s money. This is evidence of depravity of economic system in Indonesia, no longer systemic but structural. Even the rampant corruption is no longer an accident but it is by design," he said.

Meanwhile, Deputy Director of Academic MSi-Doctoral Program in Faculty of Economics and Business, Dr. Arti Adji, suggested that with this economic condition, conventional economic theories are no longer able to answer the problem. Economic studies using behavioral economics analysis is needed in Indonesia rather than Western economic theories. "Behavior of Indonesian society would be more appropriately analyzed using behavioral economics," he added.

Source: Marwati/UGM