Profound nature of corruption is rather simple - it stands in appropriation of exclusive or monopolistic income based on mechanisms of power and coercion. In modern world the State is a final source of power and coercion. On the other hand, the State is probably the last significant social monopoly based on mechanisms on power and coercion left in modern economically developed society. State being a production factor monopoly (or people managing the State) is having an exclusive right to determine its own value establishing or rather permanently escalating a level of taxation for its residents. State is also having an exclusive prerogative to establish a price of services (including all associated benefits) of the top-level state bureaucracy. Generally speaking, from the point of view of top-level state bureaucracy the only value of the State stands in exclusive possibilities for appropriation of income, which level is not fixed by the market. Otherwise power has no any meaning and business or self-employment would probably be more profitable occupation.

General level of corruption in society is not determined by any illegal actions, it is fundamentally a pure legal phenomenon, which under the modern realities of abundant societal domination of State monopoly is rather straightforward – the more State revenues or the larger State budget (in relation to GDP) and therefore the higher exclusive income based on power and coercion we encounter the more corrupted is this particular society.

Although, separate cases of illegal corruption cannot be entirely connected with the corruption in system of social relations, illegal corruption as a social phenomenon or taken as a whole is exclusively determined by the legal or in-law corruption. In countries where a level of in-law corruption is low, illegal corruption normally is also insignificant and vice-a-versa.

Let us consider a very simple illustration of in-law corruption in modern economically developed society - State agency for regulation of agricultural market. Activity of such agency is inefficient because its general idea is to help farmers and either to subsidize agricultural production or to keep agricultural prices above the market equilibrium employing certain kind of regulatory measures related to diminishing supply of agricultural products. What it means from the point of view of macroeconomic efficiency – scarce resources are squandered in the field where they do not produce the most efficient economic results. On the other hand, this practice is also producing an equal degree of societal injustice, because higher prices or subsidies in agriculture means that people have to pay more of their hard-earned money for the regulated activities. Speaking otherwise, people in other sectors of economy have to work harder or more for the same amount of money than people in agriculture. On top of that, people also have to pay taxes in order to finance these regulatory measures or subsidies. This money is partly paid to agency’s employees, which actions under such circumstances neither produce economic efficiency nor can be socially justified. Probably people in that agency, especially technical experts and middle management, are skilled professionals and hard-workers. But this does not change a bit an essence of their actions – their activity is generally inefficient. While we can be sure that top management of this agency will do everything possible in order not only to maintain agency’s status, but also in order to expand agency's responsibilities and to increase its budget simultaneously escalating a level of in-law corruption in society.

Any legal activity, which is producing economic inefficiency and injustice in income distribution and which is based upon mechanisms of power and coercion represents the in-law corruption in a system of social and property relations.