An Experimental Bribery Game
Essential characteristics of corruption are (1) a reciprocity relationship between briber and public official, (2) negative external effects to others, and (3) high penalties for the parties involved in case of discovery. We separate the behavioural influences of these factors in a laboratory experiment. A two-player reciprocity game is designed in which trust and recipro-cation cause negative external effects to other subjects and are overall inefficient. A control treatment without such negative externalities is also conducted. In a third, so-called sudden death treatment, corrupt pairs face a low probability of being punished by exclusion from the experiment without payment. All games are played in supergames with fixed pairs. The results show that trust and reciprocation establish stable bribery relationships, where the negative externality has no apparent effect on behaviour. The threat of the sudden death penalty, how-ever, significantly reduces the frequency of corrupt decisions, although additional question-naires suggest that the discovery probability is even under-estimated.
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