Since assuming power, China's new leadership has focused on curbing official excess, enforcing discipline and combating corruption. Its latest crackdown on graft, especially, has been the fiercest and most sustained since reforms began over three decades ago.

Incredibly, despite the massive public support for the crackdown, some apologists are again singing the broken tune that corruption is an inevitable consequence of economic development. Yet, others said the crackdown would weaken consumer demand and further retard growth, thus affecting employment and social stability.

But it is fact that corruption harms the economy in the long run: it raises transaction costs, undermines public order and weakens entrepreneurship. While corruption does push up the sales and prices of real estate, fine dining and luxury cars, this "irrational exuberance" is a bubble that is bound to burst. And if there really is a price to pay, the Chinese people who have had enough with corruption and the businessmen who have long been exploited by dirty officials would be glad to pay it to rid themselves of the scourge.

Based on an article from caixin.com.

caixin.com