Economic Effects of Using Nepotism and Cronyism in the Employment Process in the Public Sector Institutions

Abstract

This study aims to discern the role of nepotism and cronyism in the weakening of economic performance of the government institutions through exposure to this practice in the three Arab Countries; Iraq, Saudi Arabia, and Jordan, The study relied on the analysis of what was stated in the related literature which illustrate the effect of using nepotism and Cronyism in the employment process in a governmental position, to result in a slowdown and stumbled in the delivery of government services to citizens. After analyzing how the practice of nepotism and cronyism in the three countries, the study found the following results:  Nepotism and cronyism are practiced not only in developing countries, but also in advanced countries.  Using nepotism and cronyism in employment process is unethical behavior.  The use of nepotism and cronyism in the public sector is much more than private sector.  Nepotism and cronyism can be considered as a part of the national culture in Arab countries.  Nepotism and cronyism have negative economic repercussions, both at the level of the national economy, or the per capita income level. Because the salaries paid to staff recruited through them considered as a burden on the state treasury. Also, the large number of times to visit the citizen government department, to get the same service, lead to the loss of his income as a transition expenses.  Nepotism and cronyism are from reasons of administrative corruption in the studied countries.