IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Corruption Perceptions vs. Corruption Reality

  • Olken, Benjamin

Accurate citizen perceptions of corruption are crucial for the political process to effectively restrain corrupt activity. This paper examines the accuracy of these perceptions by comparing Indonesian villagers' stated beliefs about corruption in a road-building project in their village with a more objective measure of `missing expenditures' in the project. I find that villagers' beliefs do contain real information, and that villagers are sophisticated enough to distinguish between corruption in a particular road project and general corruption in the village. The magnitude of their information, however, is small, in part because officials hide corruption where it is hardest for villagers to detect. I also find that there are biases in beliefs that may affect citizens' monitoring behaviour. For example, ethnically heterogeneous villages have higher perceived corruption levels and greater citizen monitoring, but lower actual levels of missing expenditures. The findings illustrate the limitations of relying solely on corruption perceptions, whether in designing anti-corruption policies or in conducting empirical research on corruption.

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:
Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6272.

in new window

Date of creation: Apr 2007
Date of revision:
Handle: RePEc:cpr:ceprdp:6272
Contact details of provider: Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820

Order Information: Email:

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. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert Vishny, 1998. "The Quality of Goverment," NBER Working Papers 6727, National Bureau of Economic Research, Inc.
  2. repec:oup:qjecon:v:110:y:1995:i:3:p:681-712 is not listed on IDEAS
  3. Michael D. Hurd & Kathleen McGarry, 2002. "The Predictive Validity of Subjective Probabilities of Survival," Economic Journal, Royal Economic Society, vol. 112(482), pages 966-985, October.
  4. Petia Topalova & Esther Duflo & Rohini Pande & Lori Beaman & Raghabendra Chattopadhyay, 2008. "Powerful Women: Does Exposure Reduce Bias?," Working Papers id:1617, eSocialSciences.
  5. repec:oup:qjecon:v:121:y:2006:i:4:p:1211-1248 is not listed on IDEAS
  6. Sendhil Mullainathan & Marianne Bertrand, 2001. "Do People Mean What They Say? Implications for Subjective Survey Data," American Economic Review, American Economic Association, vol. 91(2), pages 67-72, May.
  7. Brian A. Jacob & Lars Lefgren, 2005. "Principals as Agents: Subjective Performance Measurement in Education," NBER Working Papers 11463, National Bureau of Economic Research, Inc.
  8. Miguel, Edward & Gugerty, Mary Kay, 2005. "Ethnic diversity, social sanctions, and public goods in Kenya," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2325-2368, December.
  9. J. Dominitz & C. F. Manski, . "Using expectations data to study subjective income expectations," Institute for Research on Poverty Discussion Papers 1050-94, University of Wisconsin Institute for Research on Poverty.
  10. Olken, Benjamin A., 2009. "Corruption perceptions vs. corruption reality," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 950-964, August.
  11. repec:tpr:qjecon:v:114:y:1999:i:4:p:1243-1284 is not listed on IDEAS
  12. Benjamin Olken, 2005. "Monitoring corruption: Evidence from a field experiment in indonesia," Natural Field Experiments 00317, The Field Experiments Website.
  13. Esther Duflo & Petia Topalova, 2004. "Unappreciated service: Performance, perceptions, and women leaders in india," Framed Field Experiments 00233, The Field Experiments Website.
  14. B. Douglas Bernheim, 1989. "The Timing of Retirement: A Comparison of Expectations and Realizations," NBER Chapters, in: The Economics of Aging, pages 335-358 National Bureau of Economic Research, Inc.
  15. Omar Azfar & Peter Murrell, 2005. "Identifying Reticent Respondents: Assessing the Quality of Survey Data on Corruption and Values," Electronic Working Papers 05-001, University of Maryland, Department of Economics.
  16. Baqir, Reza & Easterly, William & Alesina, Alberto, 1999. "Public Goods and Ethnic Divisions," Scholarly Articles 4551797, Harvard University Department of Economics.
  17. repec:umd:umdeco:azfar_murrell_1 is not listed on IDEAS
  18. Deaton, A.S., 1993. "Data and Econometric Tools for Development Analysis," Papers 172, Princeton, Woodrow Wilson School - Development Studies.
  19. repec:tpr:qjecon:v:124:y:2009:i:4:p:1497-1540 is not listed on IDEAS
  20. repec:feb:natura:0037 is not listed on IDEAS
  21. repec:oup:qjecon:v:114:y:1999:i:4:p:1243-1284 is not listed on IDEAS
  22. Glaeser, Edward L. & Saks, Raven E., 2006. "Corruption in America," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1053-1072, August.
  23. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, June.
  24. Di Tella, Rafael & Schargrodsky, Ernesto, 2003. "The Role of Wages and Auditing during a Crackdown on Corruption in the City of Buenos Aires," Journal of Law and Economics, University of Chicago Press, vol. 46(1), pages 269-92, April.
  25. repec:tpr:qjecon:v:122:y:2007:i:4:p:1639-1676 is not listed on IDEAS
  26. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
  27. Raymond Fisman & Shang-Jin Wei, 2001. "Tax Rates and Tax Evasion: Evidence from "Missing Imports" in China," NBER Working Papers 8551, National Bureau of Economic Research, Inc.
  28. Naci Mocan, 2008. "What Determines Corruption? International Evidence From Microdata," Economic Inquiry, Western Economic Association International, vol. 46(4), pages 493-510, October.
  29. repec:oup:qjecon:v:119:y:2004:i:2:p:678-704 is not listed on IDEAS
  30. Marianne Bertrand & Simeon Djankov & Rema Hanna & Sendhil Mullainathan, 2006. "Does Corruption Produce Unsafe Drivers?," NBER Working Papers 12274, National Bureau of Economic Research, Inc.
  31. Edward L. Glaeser & Raven Saks, 2004. "Corruption in America," NBER Working Papers 10821, National Bureau of Economic Research, Inc.
  32. Stephen Knack & Philip Keefer, 1995. "Institutions And Economic Performance: Cross-Country Tests Using Alternative Institutional Measures," Economics and Politics, Wiley Blackwell, vol. 7(3), pages 207-227, November.
  33. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June.
  34. William F. Bassett & Robin L. Lumsdaine, 2001. "Probability Limits: Are Subjective Assessments Adequately Accurate?," Journal of Human Resources, University of Wisconsin Press, vol. 36(2), pages 327-363.
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:cpr:ceprdp:6272. 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: ()

The email address of this maintainer does not seem to be valid anymore. Please ask to update the entry or send us the correct address

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.