IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Devolutionary delusions? The effect of decentralization on corruption

Listed author(s):
  • Ivar Kolstad
  • Arne Wiig
  • Vincent Somville

The effect of government decentralization on corruption is theoretically ambiguous. On the one hand, bringing government closer to the people could increase accountability and reduce corruption. On the other hand, decentralization could increase local capture and uncoordinated bribe taking across government levels. This paper estimates the effect of decentralization on experienced corruption, using individual-level bribery data from 36 countries. Crucially, we distinguish between the effect of decentralization on the frequency of contact with public officials, and its effect on the probability that a bribe is paid given contact. To identify the causal effect, we use an original instrument based on countries’ climatic heterogeneity. The results show that decentralization increases contact with officials, but there is no significant effect on the propensity to pay bribes given contact. We hence find no evidence that decentralization increases accountability. Moreover, higher aggregate corruption in decentralized societies is at least partly due to greater interaction with public officials, and not necessarily due to greater local capture.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: https://www.cmi.no/publications/file/5227-devolutionary-delusions.pdf
Download Restriction: no

Paper provided by CMI (Chr. Michelsen Institute), Bergen, Norway in its series CMI Working Papers with number 10.

as
in new window

Length: 28 pages
Date of creation: 2014
Handle: RePEc:chm:wpaper:wp2014-10
Contact details of provider: Postal:
P.O. Box 6033, N-5020 Bergen

Phone: +47 55 57 40 00
Fax: +47 55 57 41 66
Web page: https://www.cmi.no
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Brunetti, Aymo & Weder, Beatrice, 2003. "A free press is bad news for corruption," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1801-1824, August.
  2. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
  3. Jakob Svensson, 2003. "Who Must Pay Bribes and How Much? Evidence from a Cross Section of Firms," The Quarterly Journal of Economics, Oxford University Press, vol. 118(1), pages 207-230.
  4. Nathan Nunn & Diego Puga, 2012. "Ruggedness: The Blessing of Bad Geography in Africa," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 20-36, February.
  5. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
  6. Kumar, Sanjay, 2002. "Does "Participation" in Common Pool Resource Management Help the Poor? A Social Cost-Benefit Analysis of Joint Forest Management in Jharkhand, India," World Development, Elsevier, vol. 30(5), pages 763-782, May.
  7. Galasso, Emanuela & Ravallion, Martin, 2005. "Decentralized targeting of an antipoverty program," Journal of Public Economics, Elsevier, vol. 89(4), pages 705-727, April.
  8. Andvig, Jens Chr. & Moene, Karl Ove, 1990. "How corruption may corrupt," Journal of Economic Behavior & Organization, Elsevier, vol. 13(1), pages 63-76, January.
  9. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and corruption: evidence across countries," Journal of Public Economics, Elsevier, vol. 83(3), pages 325-345, March.
  10. Labonne, Julien & Chase, Robert S., 2009. "Who is at the Wheel When Communities Drive Development? Evidence from the Philippines," World Development, Elsevier, vol. 37(1), pages 219-231, January.
  11. Jakob Svensson, 2005. "Eight Questions about Corruption," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 19-42, Summer.
  12. Claudio Ferraz & Frederico Finan, 2011. "Electoral Accountability and Corruption: Evidence from the Audits of Local Governments," American Economic Review, American Economic Association, vol. 101(4), pages 1274-1311, June.
  13. Vijayendra Rao & Ana Maria Ibanez, 2005. "The Social Impact of Social Funds in Jamaica: A 'Participatory Econometric' Analysis of Targeting, Collective Action, and Participation in Community-Driven Development," Journal of Development Studies, Taylor & Francis Journals, vol. 41(5), pages 788-838.
  14. Araujo, M. Caridad & Ferreira, Francisco H.G. & Lanjouw, Peter & Özler, Berk, 2008. "Local inequality and project choice: Theory and evidence from Ecuador," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1022-1046, June.
  15. Pranab Bardhan & Sandip Mitra & Dilip Mookherjee & Abhirup Sarkar, 2008. "POLITICAL PARTICIPATION, CLIENTELISM AND TARGETING OF LOCAL GOVERNMENT PROGRAMS: Analysis of Survey Results from Rural West Bengal, India," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-171, Boston University - Department of Economics.
  16. Timothy Besley & Rohini Pande & Vijayendra Rao, 2005. "Participatory Democracy in Action: Survey Evidence from South India," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 648-657, 04/05.
  17. Ryvkin, Dmitry & Serra, Danila, 2012. "How corruptible are you? Bribery under uncertainty," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 466-477.
  18. Fan, C. Simon & Lin, Chen & Treisman, Daniel, 2009. "Political decentralization and corruption: Evidence from around the world," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 14-34, February.
  19. Lessmann, Christian & Markwardt, Gunther, 2010. "One Size Fits All? Decentralization, Corruption, and the Monitoring of Bureaucrats," World Development, Elsevier, vol. 38(4), pages 631-646, April.
  20. Kunicov , Jana & Rose-Ackerman, Susan, 2005. "Electoral Rules and Constitutional Structures as Constraints on Corruption," British Journal of Political Science, Cambridge University Press, vol. 35(04), pages 573-606, October.
  21. Ivar Kolstad & Arne Wiig, 2011. "Does democracy reduce corruption?," CMI Working Papers 4, CMI (Chr. Michelsen Institute), Bergen, Norway.
  22. Pranab Bardhan, 2002. "Decentralization of Governance and Development," Journal of Economic Perspectives, American Economic Association, vol. 16(4), pages 185-205, Fall.
  23. Mehmet Bac, 2001. "Corruption, Connections and Transparency: Does a Better Screen Imply a Better Scene?," Public Choice, Springer, vol. 107(1), pages 87-96, April.
  24. Dilip Mookherjee & Pranab K. Bardhan, 2000. "Capture and Governance at Local and National Levels," American Economic Review, American Economic Association, vol. 90(2), pages 135-139, May.
  25. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June.
  26. Albornoz, Facundo & Cabrales, Antonio, 2013. "Decentralization, political competition and corruption," Journal of Development Economics, Elsevier, vol. 105(C), pages 103-111.
  27. Acemoglu,Daron & Robinson,James A., 2009. "Economic Origins of Dictatorship and Democracy," Cambridge Books, Cambridge University Press, number 9780521671422, December.
  28. Pranab Bardhan & Dilip Mookherjee, 2006. "Decentralisation and Accountability in Infrastructure Delivery in Developing Countries," Economic Journal, Royal Economic Society, vol. 116(508), pages 101-127, January.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:chm:wpaper:wp2014-10. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Robert Sjursen)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.