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Immunity

  • Karthik Reddy
  • Moritz Schularick
  • Vasiliki Skreta

Legal provisions that protect politicians from arrest and prosecution exist throughout much of the modern democratic world. Why, and with what effects, do societies choose to place their politicians above the law? We examine the institution of immunity both theoretically and empirically. Our theoretical model demonstrates that immunity is a double-edged sword; while statutory immunity provisions protect honest politicians from politically-motivated charges, they may also incentivize corrupt behavior. Which effect dominates depends on the quality of the judicial system. In order to empirically analyze the effects of immunity provisions, we quantify the strength of immunity protection enjoyed by heads of government, ministers, and legislators in 73 democracies. We find empirical evidence that though stronger immunity protection is associated with greater corruption where the judicial system is independent, this relationship has more ambiguous effects where the legal system is weak and susceptible to politicization. These effects remain after controlling for standard determinants of corruption.

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Paper provided by New York University, Leonard N. Stern School of Business, Department of Economics in its series Working Papers with number 12-17.

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Date of creation: 2012
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Handle: RePEc:ste:nystbu:12-17
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New York University, Leonard N. Stern School of Business, Department of Economics, 44 West 4th Street, New York, NY 10012-1126

Phone: (212) 998-0860
Fax: (212) 995-4218
Web page: http://w4.stern.nyu.edu/economics/

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  1. Chowdhury, Shyamal K., 2004. "The effect of democracy and press freedom on corruption: an empirical test," Economics Letters, Elsevier, vol. 85(1), pages 93-101, October.
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