erty. The World Bank also cites three ways that corruption directly affects the poor. First, inadequate distribution of unemployment benefits, disability benefits, and public service spending affects those at the lowest levels the most, those that require a social safety net. Second, while larger rates of corruption at the household level affect all classes, they especially affect the poor. In Latvia, 31 percent of households in the poorest bracket reported knowing how to deal with corrupt public service officials, while that figure was 42 percent for the richest bracket. Finally, small businesses and microentrepreneurs are significantly more susceptible to paying bribes than are larger firms, with smaller businesses reportedly paying twice the amount that larger firms pay in bribe money. Corruption is also highly correlated with inequality, and has proven to be a significant contributor to higher gini coefficients in transition economies. Transition countries plagued by high amounts of corruption have gini coefficients that have approached 0.5. These figures are comparable to some of the most unequal Latin American countries, where inequality has been one of the most significant downfalls of development.Yet another negative consequence of corruption is a lack of credibility given to political leadership. When a country does not have faith in its leaders, it certainly does not bode well for the future of its transition and reform process. BEEPS data indicates that in countries with high levels of capture and administrative corruption, a mere 38 percent of firms are content with their political leadership, while this figure is 56 percent in the other transition economies. There is also a significantly greater presence of organized crime in transition countries facing high levels of corruption. 50 percent of firms in countries with high levels of corruption report organized crime as an obstacle to their business, while this f...
