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How to Subvert Democracy: Montesinos in Peru

  • John McMillan

    ()

    (Graduate School of Business, Stanford University)

  • Pablo Zoido

    ()

    (Graduate School of Business, Stanford University)

Which of the democratic checks and balances—opposition parties, the judiciary, a free press—is the most forceful? Peru has the full set of democratic institutions. In the 1990s, the secret-police chief Montesinos systematically undermined them all with bribes. We quantify the checks using the bribe prices. Montesinos paid a television-channel owner about 100 times what he paid a judge or a politician. One single television channel’s bribe was five times larger than the total of the opposition politicians’ bribes. By revealed preference, the strongest check on the government’s power was the news media.

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Paper provided by Stanford Institute for Economic Policy Research in its series Discussion Papers with number 03-030.

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Date of creation: Jul 2004
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Handle: RePEc:sip:dpaper:03-030
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  1. Stole, Lars A & Zwiebel, Jeffrey, 1996. "Intra-firm Bargaining under Non-binding Contracts," Review of Economic Studies, Wiley Blackwell, vol. 63(3), pages 375-410, July.
  2. Torsten Persson & Gerard Roland & Guido Tabellini, . "Separation of Powers and Political Accountability," Working Papers 100, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  3. Rafael LaPorta & Florencio Lopez-de-Silane & Cristian Pop-Eleches & Andrei Shleifer, 2003. "Judicial Checks and Balances," NBER Working Papers 9775, National Bureau of Economic Research, Inc.
  4. Timothy Besley & Andrea Prat, 2006. "Handcuffs for the Grabbing Hand? Media Capture and Government Accountability," American Economic Review, American Economic Association, vol. 96(3), pages 720-736, June.
  5. Alicia Adsera & Carles Boix & Mark Payne, 2000. "Are You Being Served?: Political Accountability and Quality of Government," Research Department Publications 4241, Inter-American Development Bank, Research Department.
  6. Djankov, Simeon & Caralee, McLiesh & Nenova, Tatiana & Shleifer, Andrei, 2003. "Who Owns the Media?," Scholarly Articles 3606236, Harvard University Department of Economics.
  7. Lambsdorff, Johann Graf, 2002. "Making corrupt deals: contracting in the shadow of the law," Journal of Economic Behavior & Organization, Elsevier, vol. 48(3), pages 221-241, July.
  8. Eric Maskin & Jean Tirole, 2004. "The Politician and the Judge: Accountability in Government," Economics Working Papers 0020, Institute for Advanced Study, School of Social Science.
  9. 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.
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