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Can transparency of information reduce embezzlement? Experimental Evidence from Tanzania

Author

Listed:
  • Salvatore Di Falco

    (UNIGE - Université de Genève = University of Geneva)

  • Brice Magdalou

    (LAMETA - Laboratoire Montpelliérain d'Économie Théorique et Appliquée - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - INRA - Institut National de la Recherche Agronomique - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)

  • David Masclet

    (CIRANO - Centre interuniversitaire de recherche en analyse des organisations - UQAM - Université du Québec à Montréal = University of Québec in Montréal, CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

  • Marie Claire Villeval

    (GATE Lyon Saint-Étienne - Groupe d'Analyse et de Théorie Economique Lyon - Saint-Etienne - ENS de Lyon - École normale supérieure de Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - CNRS - Centre National de la Recherche Scientifique)

  • Marc Willinger

    (LAMETA - Laboratoire Montpelliérain d'Économie Théorique et Appliquée - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - INRA - Institut National de la Recherche Agronomique - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)

Abstract

Embezzlement is a major concern in various settings. By means of a sequential modified dictator game, we investigate theoretically and experimentally whether making information more transparent and reducing the number of intermediaries in transfer chains can reduce embezzlement and improve the recipients’ welfare. Consistent with referencedependent preferences in terms of moral ideal, we show that the impact of transparency is conditional on the length of the transfer chain and on the position of the intermediaries in the chain. Its direct effect on image encourages honesty. Its indirect effect via expectations plays in the opposite direction, motivating individuals to embezzle more when they expect that the following intermediary will embezzle less. Senders react positively to a reduction of the length of the chain but negatively to transparency.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Salvatore Di Falco & Brice Magdalou & David Masclet & Marie Claire Villeval & Marc Willinger, 2016. "Can transparency of information reduce embezzlement? Experimental Evidence from Tanzania," Working Papers halshs-01315697, HAL.
    • Handle: RePEc:hal:wpaper:halshs-01315697
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01315697
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    Citations

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    Cited by:

    1. Attanasi, Giuseppe & Rimbaud, Claire & Villeval, Marie Claire, 2019. "Embezzlement and guilt aversion," Journal of Economic Behavior & Organization, Elsevier, vol. 167(C), pages 409-429.
    2. Johannes Abeler & Daniele Nosenzo & Collin Raymond, 2019. "Preferences for Truth‐Telling," Econometrica, Econometric Society, vol. 87(4), pages 1115-1153, July.
    3. Luca Corazzini & Christopher Cotton & Tommaso Reggiani, 2020. "Delegation and coordination with multiple threshold public goods: experimental evidence," Experimental Economics, Springer;Economic Science Association, vol. 23(4), pages 1030-1068, December.
    4. Ye-Feng Chen & Shu-Guang Jiang & Marie Claire Villeval, 2015. "The Tragedy of Corruption. Corruption as a social dilemma," Working Papers 1531, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    5. Giulia Mugellini & Sara Della Bella & Marco Colagrossi & Giang Ly Isenring & Martin Killias, 2021. "Public sector reforms and their impact on the level of corruption: A systematic review," Campbell Systematic Reviews, John Wiley & Sons, vol. 17(2), June.
    6. Chen, Yefeng & Jiang, Shuguang & Villeval, Marie Claire, 2016. "The Tragedy of Corruption," IZA Discussion Papers 10175, Institute of Labor Economics (IZA).
    7. Garbarino, Ellen & Slonim, Robert & Villeval, Marie Claire, 2019. "Loss aversion and lying behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 158(C), pages 379-393.
    8. Cappelen, Alexander W. & Fjeldstad, Odd-Helge & Mmari, Donald & Sjursen, Ingrid Hoem & Tungodden, Bertil, 2021. "Understanding the resource curse: A large-scale experiment on corruption in Tanzania," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 129-157.
    9. Daniel Parra & Manuel Munoz-Herrera & Luis Palacio, 2019. "The limits of transparency as a means of reducing corruption," Working Papers 20190026, New York University Abu Dhabi, Department of Social Science, revised May 2019.
    10. García-Gallego, Aurora & Georgantzis, Nikos & Jaber-López, Tarek & Michailidou, Georgia, 2020. "Audience effects and other-regarding preferences against corruption: Experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 159-173.

    More about this item

    Keywords

    Embezzlement; corruption; dishonesty; transparency; experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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