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Cracking Down on Bribery

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  • Banuri, Sheheryar
  • Eckel, Catherine

Abstract

Do crackdowns on bribery impact corrupt behavior in the long run? In this paper we observe the long-run impact of a short-term punishment institution (i.e., a crackdown) on bribery behavior in a lab setting. We conduct lab experiments in two countries with cultures that differ in corruption norms, and which experience very different levels of bribery: the US and Pakistan. Bribery is implemented in the laboratory as a repeated three-player sequential game, consisting of a firm, a government official and a citizen. The design contains three phases: pre-crackdown, crackdown, and post-crackdown. Results show that post-crackdown behavior is not significantly different from the pre-crackdown behavior in either country. We conclude that short-term crackdowns may impact behavior in the short run, depending on the strength of the existing corruption norms in the country. More importantly, in our setting crackdowns are completely ineffective in the long run, as corrupt behavior rebounds to pre-crackdown levels.

Suggested Citation

  • Banuri, Sheheryar & Eckel, Catherine, 2015. "Cracking Down on Bribery," MPRA Paper 61235, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:61235
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    References listed on IDEAS

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    1. repec:eee:wdevel:v:105:y:2018:i:c:p:171-188 is not listed on IDEAS
    2. Zhixin Dai & Fabio Galeotti & Marie Claire Villeval, 2017. "The efficiency of crackdowns: a lab-in-the-field experiment in public transportations," Theory and Decision, Springer, vol. 82(2), pages 249-271, February.
    3. Chen, Yefeng & Jiang, Shuguang & Villeval, Marie Claire, 2016. "The Tragedy of Corruption," IZA Discussion Papers 10175, Institute for the Study of Labor (IZA).
    4. Dmitry Ryvkin & Danila Serra, 2016. "The Industrial Organization of Corruption: Monopoly, Competition and Collusion," Working Papers wp2016_10_01, Department of Economics, Florida State University.
    5. repec:eee:eecrev:v:94:y:2017:i:c:p:1-22 is not listed on IDEAS

    More about this item

    Keywords

    Bribery; Corruption; Experiments; Punishment; Culture;

    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
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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