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Trust and Bribery: The Role of the Quid Pro Quo and the Link with Crime

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  • Hunt, Jennifer

    ()
    (Rutgers University)

Abstract

I study data on bribes actually paid by individuals to public officials, viewing the results through a theoretical lens that considers the implications of trust networks. A bond of trust may permit an implicit quid pro quo to substitute for a bribe, which reduces corruption. Appropriate networks are more easily established in small towns, by long-term residents of areas with many other long-term residents, and by individuals in regions with many residents their own age. I confirm that the prevalence of bribery is lower under these circumstances, using the International Crime Victim Surveys. I also find that older people, who have had time to develop a network, bribe less. These results highlight the uphill nature of the battle against corruption faced by policy-makers in rapidly urbanizing countries with high fertility. I show that victims of (other) crimes bribe all types of public officials more than non-victims, and argue that both their victimization and bribery stem from a distrustful environment.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1179.

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Length: 44 pages
Date of creation: Jun 2004
Date of revision:
Handle: RePEc:iza:izadps:dp1179

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Keywords: networks; crime; corruption;

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References

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  1. Naci Mocan, 2008. "What Determines Corruption? International Evidence From Microdata," Economic Inquiry, Western Economic Association International, vol. 46(4), pages 493-510, October.
  2. Jenkins, Stephen P. & Osberg, Lars, 2003. "Nobody to play with? The implications of leisure coordination," ISER Working Paper Series 2003-19, Institute for Social and Economic Research.
  3. Edward L. Glaeser & Bruce Sacerdote, 1996. "Why Is There More Crime in Cities?," NBER Working Papers 5430, National Bureau of Economic Research, Inc.
  4. Swamy, Anand & Knack, Stephen & Lee, Young & Azfar, Omar, 2001. "Gender and corruption," Journal of Development Economics, Elsevier, vol. 64(1), pages 25-55, February.
  5. Svensson, Jakob, 2000. "Who must pay bribes and how much? Evidence from a cross-section of firms," Policy Research Working Paper Series 2486, The World Bank.
  6. Sanjeev Gupta, 1998. "Does Corruption Affect Income Inequality and Poverty?," IMF Working Papers 98/76, International Monetary Fund.
  7. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and corruption: evidence across countries," Journal of Public Economics, Elsevier, vol. 83(3), pages 325-345, March.
  8. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June.
  9. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  10. Falk, Armin & Kosfeld, Michael, 2003. "It's all about Connections: Evidence on Network Formation," IZA Discussion Papers 777, Institute for the Study of Labor (IZA).
  11. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
  12. Lui, Francis T, 1985. "An Equilibrium Queuing Model of Bribery," Journal of Political Economy, University of Chicago Press, vol. 93(4), pages 760-81, August.
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Cited by:
  1. Francisco Alvarez-Cuadrado, 2006. "A Quantitative Exploration Of The Golden Age Of European Growth: Structural Change, Public Investment, The Marshall Plan And Intra-European Trade," Departmental Working Papers 2005-01, McGill University, Department of Economics.
  2. us Swaleheen, Mushfiq, 2008. "Corruption and saving in a panel of countries," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 1285-1301, September.
  3. Jennifer Hunt, 2006. "How Corruption Hits People When They Are Down," Departmental Working Papers 2006-07, McGill University, Department of Economics.
  4. Ricardo Montero & Gustavo Yamada, 2011. "Raza, corrupción y acceso a servicios públicos en el Perú: ¿Exclusión o discriminación?," Working Papers 11-03, Departamento de Economía, Universidad del Pacífico, revised Aug 2011.
  5. Gil S. Epstein & Ira N. Gang, 2009. "Why Pay Taxes When No One Else Does?," Departmental Working Papers 200902, Rutgers University, Department of Economics.
  6. Hunt, Jennifer & Laszlo, Sonia, 2012. "Is Bribery Really Regressive? Bribery’s Costs, Benefits, and Mechanisms," World Development, Elsevier, vol. 40(2), pages 355-372.
  7. Ricardo Montero & Gustavo Yamada, 2012. "Exclusión y discriminación étnica en los servicios públicos en el Perú," Chapters of Books, in: Francisco Galarza (ed.), Discriminación en el Perú: Exploraciones en el Estado, la empresa y el mercado laboral, edition 1, volume 1, chapter 1, pages 219-278 Departamento de Economía, Universidad del Pacífico.
  8. Chavis, Larry, 2013. "Social networks and bribery: The case of entrepreneurs in Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 41(1), pages 279-293.
  9. Hunt, Jennifer & Laszlo, Sonia, 2005. "Bribery: Who Pays, Who Refuses, What are the Payoffs?," CEPR Discussion Papers 5251, C.E.P.R. Discussion Papers.
  10. Chongwoo Choe & Ratbek Dzhumashev & Asadul Islam & Zakir H. Khan, 2011. "Corruption and Network in Education: Evidence from the Household Survey Data in Bangladesh," Development Research Unit Working Paper Series 08-11, Monash University, Department of Economics.
  11. Şeker, Murat & Yang, Judy S., 2014. "Bribery solicitations and firm performance in the Latin America and Caribbean region," Journal of Comparative Economics, Elsevier, vol. 42(1), pages 246-264.
  12. Jennifer Hunt, 2005. "Why Are Some Public Officials More Corrupt Than Others?," William Davidson Institute Working Papers Series wp790, William Davidson Institute at the University of Michigan.

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