Abstract
This article reviews the main corruption literature trends and theoretical foundations and points out the challenges of existing explanations of corruption. The emphasis on broad national-level variables limits our understanding of corruption and anti-corruption processes at the local level. Corruption studies also suffer from the bias of focusing on developing countries and nation-states. These shortcomings can be remedied by using an integrated approach to studying corruption in western countries and cities.
Introduction
Political corruption has been widely discussed in the media and each year numerous corruption studies get published. This increased attention is likely caused by the frequent exposure of corruption scandals in the media and the subsequent recognition that corruption shows little sign of disappearing. Although it has been argued that corruption could be useful for “greasing the wheels” of bureaucracy and getting things done (Huntington, 1968; Leff, 1964; Leys, 1970; Nguyen et al., 2016; Rose-Ackerman, 1978), the general agreement among scholars and policy analysts is that the consequences of corruption are harmful to society, the economy, the government, and public trust.
Most scholars agree on the negative effects of corruption (Dimant and Tosato, 2018; Liu, 2016; Mauro, 1996; Oji and Oji, 2010; Pedersen and Johannsen, 2018; Rose-Ackerman and Kornai, 2004; Rothstein, 2005; Rothstein and Uslaner, 2005). Researchers have convincingly demonstrated that corruption negatively affects economic growth and growth rates by decreasing private investment, and that corruption distorts international trade and investment flows (Glynn et al., 1997; Mauro, 1996; Pinto and Zhu, 2016; Qian and Sandoval-Hernandez, 2016). Others argue that corruption erodes social capital by lowering trust (Banerjee, 2016; López and Santos, 2014; Nix et al., 2017; Rothstein and Uslaner, 2005), distorts public priorities (Karklins, 2005; Tickner, 2017; Wang and You, 2016), and benefits the selected few as opposed to the many (Borcan et al., 2017; Newell, 2018). It reduces the resources allocated to education and health sectors and fosters policies that increase income inequality (Batabyal and Chowdhury, 2015; Mauro, 1996; Ortega et al., 2016). Corruption also adversely affects the societal benefits of natural resources in resource-rich countries (Williams and Le Billon, 2017).
Corruption also makes the economy inefficient, human talent is misused as a result of nepotism, and corrupt dealings lead to substandard workmanship (Ariely and Uslaner, 2017; Kaufmann, 1997). Warren (2004: 328) considers corruption dangerous because it “reduces the effective domain of public action by reducing public agencies of collective action to instruments of private benefit.” In democracies in particular, all citizens possess the right to take part in collective actions regarding their welfare but corruption unfairly excludes the not-connected people from the opportunity to participate in these processes. Thus, in addition to creating mismanaged government, corruption undermines the very essence of democratic process and leads to a disengaged and cynical population. Indeed, unfettered corruption poses a major threat to democracy (Teachout, 2014).
This article will review the empirical findings and current trends in the corruption literature to provide a holistic overview of what we know and do not know about the causes of corruption. It will highlight the shortcomings of existing approaches and will explain the need to integrate macro and micro approaches to understanding corruption. It will also point out specific areas that could benefit from additional corruption research.
Corruption definitions
The most common definition of corruption revolves around the rules guiding public officials in their public duties. Under this definition, behavior becomes corrupt when it deviates from the official rules in order to further private interests or monetary gains. Corruption is then defined in terms of “misuse of public power for private gain” (Johnston, 2005; Karklins, 2005; LaPalombara, 1995; Philp, 2016; Scott, 1972; Transparency International, 2009, 2015). Scholars acknowledge that: although corruption comes in many shapes, shades, and sizes, and with different degrees of tolerability, corruption is always defined with one feature – the inappropriate mix of public and private as it is corrupt for officials to profit personally from public office. (Johnson and Sharma, 2004: 3)
The underlying idea is that officials entrusted with overseeing public goods should not exploit their public positions for selfish and/or private goals. Hence, Kurer and Jain (2001: 73) explains corruption as “those activities in which public officials, bureaucrats, legislators and politicians use powers delegated to them by the public to further their own economic interest at the expense of the common good.” This concept explicitly considers corruption as a divergence from behavior that is in the public’s best interest (Lancaster and Montinola, 1997). With this definition, public corruption includes deviant behaviors such as bribery, clientelism, extortion, nepotism, and theft taking place within the public domain and involving at least one public official (Langseth, 2016). The reference to “public versus private” constitutes the basis of virtually all definitions of corruption.
Measuring corruption
Measuring corruption, which is characterized by illicit activities the perpetrators are actively trying to hide, remains a difficult task for scholars and there is no universal agreement on how to measure it. Having appropriate measures, analytical frameworks, and conceptual models based on the specific corruption challenges is important. For example, Amundsen (2019) shows how political corruption can be divided into two related but separate processes – extractive and power-preserving corruption – and he argues that this distinction requires different analytical approaches.
The Transparency International (TI) Corruption Perception Index (CPI) attempts to measure the extent of government officials’ involvement in corrupt practices. The index is a “poll of polls” based on the experiences of business executives, country risk analysts, experts, and investigative journalists who do business in the countries being surveyed, and utilizes at least 13 different surveys from at least 10 different institutions (Transparency International, 2017). The CPI index includes information from resident and non-resident experts and the survey data is thoroughly cross-checked and methodologically validated.
The CPI measure is not perfect and has some methodological challenges. For example, reliance on the country’s business environment as a proxy of national corruption can be useful but it ignores other segments of government where corruption could potentially exist, for example healthcare. Likewise, the business experts could behave differently from regular citizens and could be reporting corruption based on their personal or political inclinations or limited experiences, and could potentially bias corruption survey reports (Charron, 2016). The indices grounded in perceptions could also expose the ineffectiveness of a country’s public institutions instead of the true extent of corruption.
Another way of measuring corruption is to identify the corruption occurrences from data such as the number of convictions of public officials (Cordis and Milyo, 2016; Glaeser and Saks, 2006; Simpson et al., 2015). This measure is straightforward and gives a quantifiable overview of corruption in a specific location. Nevertheless, this measure may reveal more the effective work of the judicial and prosecutorial systems than the actual levels of corruption (Galtung, 2016). The comparative application of the conviction-based data remains problematic due to the differences in the definition of corruption in different locations (United Nations Office on Drugs and Crime, 2018). The low levels of conviction rates can indicate that the preventative corruption control measures are working well by preventing corruption from occurring, but the presence of high conviction rates can also indicate successful anti-corruption measures (for example, Singapore and Hong Kong simultaneously have some of the highest corruption conviction rates and lowest levels of corruption) (Cordis and Milyo, 2016; Galtung, 2016; Galtung et al., 2016). The conviction-based data – both low and high levels – could suggest the effectiveness of anti-corruption efforts and therefore does not work well for international comparative purposes, in which cases the CPI-based index is superior (Lambsdorff, 2016). Indeed, the problems with employing conviction-based data are especially evident for international comparisons, where the use of the CPI index is preferred (Kostadinova, 2012).
Understanding the history of corruption literature
The problem of public corruption has long preoccupied scholars and writers. For example, a Google Ngram search for the keyword “corruption” shows that this phenomenon has been discussed in books since around 1550 and its popularity has waned and grown over centuries. Interestingly, as seen in Figure 1 below, the popularity of the word “corruption” in English language books increased in the late 1700s and 1800s and has been gradually climbing since the late 1990s.
Google Ngram search results for “corruption.”
Corruption studies have adopted a variety of theoretical and empirical approaches and it is not surprising that most single-discipline corruption studies have produced contradictory findings (Johnston, 2005). More precisely, corruption researchers study how official policies and laws affect corruption and most of what we know about corruption is grounded in the studies of these formal factors. A concurrent development has been new possibilities for empirical macro-level (structural) research made possible by the use of Transparency International’s corruption perception index, which ranks corruption worldwide. The macro-level studies using quantitative models tend to dominate corruption literature, perhaps due to the fact that micro-level (agency) studies are more difficult to conduct. I will argue that to better understand the nature of corruption and anti-corruption, we need to integrate the micro- and macro-level approaches.
We can review the history of corruption scholarship by considering the bifurcation of corruption explanations into the agency (micro-level) or structure (macro-level) approaches. The micro-level or agency argument centers around the notion that human agency in general is driving corrupt actions (Ward, 1989). The agency approach considers human behavior to be the consequence of individual decisions and explains differences in behavior as the outcome of individual peculiarities and diverging incentives (Collier, 2005). The agency approach to understanding the causes of and remedies to corruption consists of moralist and economic/rational choice approaches. On the one hand, the moralists view corruption through normative lenses and consider individuals – known as bad apples – to be the main sources of corruption (Johnston, 1982; Johnston and Heidenheimer, 2017). These bad apples are typically inadequately educated or inadequately trained public officials with weak character traits (Alatas, 1990; Johnston, 2005; Leys, 1965).
On the other hand, the economic/rational choice theory of causes of corruption focuses on actions by agents intended to increase the agent’s self-aggrandizing interest, considering opportunity costs and information (Monroe, 1991). The rational choice approach is exemplified by the principal–agent model (Klitgaard, 1988; Rose-Ackerman, 1978), game theory (Geddes, 1991; Manion, 1996), and cost–benefit (Nye, 1967) analyses of corruption. The most popular rational choice approach example is Klitgaard’s (1988) principal–agent model. It will be examined in more detail later in this section.
Proponents of structural explanations hold a view that social behavior is governed by specific institutional circumstances that influence the incentives for agent behavior (Johnston, 1982). Different behavior results from different institutions and circumstances. Modernization theory influences this approach, which subsumes revisionist and culturalist branches (Collier, 2005; Huntington, 1968). The role of individual agents in explaining social behavior is not deemed essential by structuralists in this “rotten barrel” approach (Johnston, 1982). In other words, it is the institutional circumstances that determine the level of corruption.
The modernization idea implies that corruption is highest when a country is in an intense phase of modernization characterized by weak institutions in flux, but decreases with the attainment of a developed country’s status exemplified by stable and efficient institutions. Corruption levels will be affected by the makeup and nature of the country’s economic and political institutions, and particularly high corruption levels usually indicate “the absence of effective political institutionalism” (Huntington, 1968: 59). Corruption thus will be higher in places that lack effective political parties and institutions.
The revisionist branch of the structural approach attempts to explain what causes corruption by looking at the functional needs for corruption, that is, how corruption fulfills a specific need not met by the government (Leff, 1964; Merton, 1968; Scott, 1972). The main assumption of revisionists is that corruption can promote a more efficient functioning of dysfunctional political and economic systems, consequently sustaining the corruption and dysfunction of the system. For example, a comprehensive study of American urban political machines demonstrates that corruption grows from the practical need to provide services when the government is unable to do it (Merton, 1968).
The culturalist branch of the structural school argues that the extent of corruption in society depends upon the nature of a country’s culture and increases when the self-interests of various groups, such as ethnic groups or clans, dominate (Huntington, 1968). The challenge of cultural relativity is partially explained by arguing that modern societies with high civic standards and strict views of corruption generate lower corruption (Heidenheimer, 1970; Johnston and Heidenheimer, 2017).
Current corruption literature: macro- and micro-level approaches
I will now provide a more detailed assessment of explanations of corruption within the current framework of the structural and agency approaches to studying corruption. In contrast to the previous section, this review focuses on the current state of corruption literature. For the purposes of this study, I use the words structural and macro-level, and agency and micro-level interchangeably.
Macro-level explanations of corruption
In general, modern macro-oriented research tends to focus on identifying the variables affecting corruption risks such as economic factors, democracy, institutions, and political parties. The macro-level analysis improves knowledge about the relationships between corruption and public institutions, political capability circumstances, and cultures (Ades and Di Tella, 1999; Batory, 2018; Della Porta and Vannucci, 2016; Drury et al., 2006; Paldam, 2001; Pellegrini and Gerlagh, 2004; Suleiman and Othman, 2017). However, while new studies of corruption help us better understand the persistence of corruption, this research still contains conflicting findings on the specific causes of corruption.
The macro-oriented corruption literature branch has demonstrated the damaging impact of corruption on economic growth, although this relationship is not linear and with many caveats (Bardhan, 1997; Mauro, 1995). One key factor in explaining the varying levels of corruption has been economic development, particularly income levels measured in Gross Domestic Product (GDP) per capita variations (Ades and Di Tella, 1999; Campos and Giovannoni, 2017; Damania et al., 2004; Kunicova and Rose-Ackerman, 2005; Lederman et al., 2005; Paldam, 2002; Persson and Tabellini, 2003; Swamy et al., 2001; Treisman, 2000). Countries with greater per capita income are correlated with lower citizen/voter corruption despite some researchers questioning the correlation (Kaufmann, 1999) and several scholars having discovered the opposite (Braun and Di Tella, 2004; Frechette, 2001). Similarly, some scholars find that another economic factor – income equality – decreases corruption (Paldam, 2002; Rothstein and Uslaner, 2005), whereas other scholars find no statistically significant relationships (Brown et al., 2005).
Democracy is frequently described as the crucial antidote to corruption due to improved transparency and responsibility, which make corruption harder to maintain. Moreover, civil liberties in democracy are thought to reduce corruption (Damania et al., 2004; Goldsmith, 1999; Kunicova and Rose-Ackerman, 2005; Lederman et al., 2005; Paldam, 2002; Svensson, 2005; Swamy et al., 2001). On the other hand, Treisman (2000) fails to uncover a statistically significant relationship between corruption levels and democracy, that is, whether the country was democratic or not did not have any impact on corruption levels.
It is also possible that democracy does not help stem corruption because the electoral system does not function as envisioned: if corrupt politicians are not penalized at the polls, they therefore stand favorable chances of being reelected (Chang and Golden, 2007). Analyses of this contradiction – unpopular corruption and popular corrupt politician – emphasize the factors of both supply and demand. While the latter views the voters with peculiar societal norms or incomplete information on the extent and consequences of corruption as the key obstacle to a corruption-free society, the former criticizes the overall political system for being unable to provide corruption-free alternatives to the voters (Kurer and Jain, 2001). Generally, democracy seems to reduce corruption, although the difficulty is separating the impact of democracy from other important factors such as the level of economic development and media freedoms. Some researchers argue that the negative impact of democracy on corruption levels vanishes when we take into consideration wealth and Protestant religion (Lane et al., 2000) or income inequality (Donovan and Karp, 2017).
Relevant research has explored work security-related incentives in electoral victories in democracies and has concluded that the necessity for electoral resources can thwart virtually all reforms of patronage networks in South America (Geddes, 1991). Patronage, which is usually defined by the exploitation of various government resources such as public contracts, jobs, and construction licenses to reward loyal political supporters, exists as part of political power structures all over the world (Collier, 2002; Flinders and Geddes, 2014). Any attempts to reform and undermine patronage remain problematic because, even if honest politicians desire to implement meaningful reforms, they usually cannot afford the reforms due to their political survival being jeopardized by the loss of electoral resources ( Flinders and Geddes, 2014; Geddes, 1991).
When it comes to public institutions, legal structures and official rules decide, at least partially, what behavior is considered corrupt. Vital institutional features include local or national electoral arrangements and election format, and type of party funding (Alexander and Shiratori, 1994; Galeotti and Merlo, 1994; Gidlund and Koole, 2001; Gunlicks, 1993; Nassmacher, 1993; Williams, 2000). Effective anti-corruption agencies are especially vital for substantive anti-corruption efforts as they can independently focus efforts to combat corruption (Gregory, 2015; Meagher, 2004; Transparency International, 2015; United Nations Office on Drugs and Crime, 2012). The anti-corruption agencies are especially effective in democracies where they are supported in their anti-corruption efforts by free media and robust democratic processes (Krajewska and Makowski, 2017; Kuris, 2015; Quah, 2017). Effective e-governments can lower overall corruption levels in the country (Agarwal and Maiti, 2020; Funk and Owen, 2020; Sanmukhiya, 2019), although some scholars find that e-governance is effective at reducing corruption only if the country has a strong rule of law (Park and Kim, 2019).
Political and administrative explanations of corruption highlight such factors as a government’s administrative efficiency, the nature and degree of political competition in the country, the government’s scope, interactions between elected politicians and government bureaucrats, and public–private interactions. We need to understand whether the political parties are institutionally separate from the government’s public administration arrangements (Heywood, 1997; Krylova, 2018); the degree of accountability, competition, and openness in the public domain; the extent of actual rivalry among the country’s authority centers (Della Porta and Vannucci, 2016; Kim and Sharman, 2014); and how long the government has been in power (Aranha, 2017; LaPalombara, 1995).
Moreover, variations in the institutional features and political power situations can impact corruption risks (Rose-Ackerman and Palifka, 2016). For example, when political parties begin losing members and become increasingly reliant on government financing or private donations, they can in some instances resort to illegal means of financing their activities. Legislative changes have not always coincided with the unofficial laws regulating party behavior (Eicher, 2016). Frequently, regulation of contribution limits to political parties develops into an issue only after financing scandals occur (Gidlund and Koole, 2001).
Scholarly literature also discusses the effects of relations between the public and private spheres on governance. Privatization is often researched for its effects on corruption levels and the research argues that privatization can exacerbate corruption by muddling the boundaries between the private and public, and private contracts can worsen the corruption risk and perceptions (Belousova et al., 2016; Doig and Wilson, 1998; Heywood, 1997, 2002; Kamal et al., 2018; Khlif et al., 2016). Others have argued that privatization is correlated with the decrease of overall corruption levels (Kaufmann and Siegelbaum, 1997; Koyuncu et al., 2010; Peña Miguel and Cuadrado-Ballesteros, 2018). Still others have argued that privatization can both increase the risks of corruption and decrease the perception of corruption at the same time (Martimort and Straub, 2006).
Finally, other variables and findings from the macro-level research include the degrees of economic and bureaucratic regulation (LaPalombara, 1995; Schlicht, 1985), the design and arrangement of public sector functions (Heywood, 1997), the legal system (Lane et al., 2000), and the style of economic system (Bardhan, 1997). Lipset and Lenz (2000) utilize quantitative measures to demonstrate the relevance of culture in a nation’s overall wealth and explore the association between a country’s religion and individualistic and familistic relations (see also Dincer and Johnston, 2016). Others, however, suggest that societal culture does not explain the levels of corruption as connected to GDP variations (Andersson, 2008; Paldam, 2001; Persson et al., 2013; Rehman and Naveed, 2007).
Although structural explanations of corruption can help explain different levels of corruption, there is little consensus regarding which specific structural factors are the most significant in explaining varying corruption levels across the world. These structural relationships also do not fully explain causal mechanisms (Rose-Ackerman and Palifka, 2016). Additionally, the usefulness of structural factors for designing anti-corruption programs is questionable. There is little practical utility in telling a country or city to become wealthier, strengthen democracy, and convert to Protestantism.
Generally, this macro-level corruption literature helps researchers to identify the institutional factors that can be useful in accounting for the differences among the nation-states (Menocal et al., 2015). Structural explanations can work quite well at the national level, but their effectiveness in explaining local levels of corruption (e.g. city-level) remains largely untested. The corruption literature in general and the macro-level approach specifically have a bias of using nation-states as research cases. The macro-level approach is typically not used in local corruption studies and the important institutional factors from the literature are not tested at the local level. Applying the macro-level approach to local corruption would test the robustness of key theoretical concepts and would help generate new theoretical and practical knowledge.
Micro-level explanations of corruption
In micro-level explanations, the focus is mostly on the actors making their choices based on specific incentives for and attitudes toward corruption, or individual choices. This approach emphasizes the actors and the choices they make in various contexts, and, thus, is concerned with individuals and their possibilities, incentives, and attitudes about corruption (Akbar and Vujić, 2014; Cartier-Bresson, 1997; Cuervo-Cazurra, 2016; Della Porta et al., 1996; Fleming and Zyglidopoulos, 2009; Gamboa-Cavazos et al., 2006; Jancsics, 2014; Nabli and Nugent, 1989; Rose-Ackerman, 1999). The important factors for an actor considering whether to engage in corruption in these kinds of analysis are the likely losses and gains and the capability to discover corrupt associates (Della Porta et al., 1996).
The anticipated benefit from corrupt behavior depends on what an actor believes other people to do, which influences the person’s probability of participating in corrupt deals. Honest government officials benefit more than corrupt public officials when few officials are engaging in corruption, but this benefit decreases as the number of corrupt public officials grows (Bardhan, 1997). In other words, the larger the proportion of corrupt public officials, the easier it becomes for another official to engage in corrupt deals. The number of individuals believed to be corrupt influences attitudes and norms that consequently affect the ethical cost for the actor considering whether to participate in corruption (Andvig and Moene, 1990; Bardhan, 1997; Della Porta and Vannucci, 2016; Gorsira et al., 2018; Lui, 1986). As the proportion of corrupt public officials increases, the expectations of corruption being detected and prosecuted decreases (Cadot, 1987). Interestingly, there is growing evidence that the higher the number of women in the labor force and government, the lower the levels of corruption (Barnes and Beaulieu, 2018; Swamy et al., 2001).
Corrupt practices established by earlier generations may lead to an environment in which younger generations could become more likely to view corruption as a normal part of life, thus sustaining corruption. Because individual reputations are decided by collective reputations, and vice versa, an actor’s motivation to sustain a good reputation becomes larger if the actor’s group or community has a reputation of high ethics (Tirole, 1996). The individual’s desire to participate in corruption is important to the individual but “the effect of that individual choice on the decisions of others is equally important” (Corbacho et al., 2016: 1081). The higher the number of individuals who deem corruption as an ethically acceptable choice, the lower the individual ethical cost of becoming involved in corrupt behavior (Gorsira et al., 2018).
The individual-level analysis in the corruption literature also assumes that behavior can be molded by diverse social influences such as media reporting and peer behavior (Dong et al., 2012; Gorsira et al., 2018; Tavits, 2010). Corruption can be lowered by democratic processes such as political openness, checks and balances, and accountability, but typically this happens through changing social norms (Cain et al., 2001; Dimant and Schulte, 2016; Neeman et al., 2008; Olsson, 2014). For example, individuals can vote out corrupt politicians after they become informed about politicians’ corruption by the media. The difficulty lies in effectively altering the social norms, with media reporting playing a major role (Stapenhurst, 2000). Being a politically well-informed individual influences perception of government corruption (Ionescu, 2017).
A non-traditional explanation of disparities in corruption levels between various sectors within the same country is Alam’s (1995) approach considering the losers from corruption and their actions to minimize their losses. The countervailing actions losers from corruption can engage in determine the level of corruption in a country. The factors that determine the capacity of people to participate in countervailing actions and consequently explain the differences in corruption levels include the types of losses from corruption, education levels, income distributions, and political, human, and property rights (Alam, 1995; Ahmad, 2004).
Principal–agent approach
The principal–agent approach is an individual (micro) level approach taking into consideration the effects of authority delegated from a principal to an agent. It is the most widely used approach to study corruption and it is also the approach most often used by policymakers designing anti-corruption policies. The principal–agent models view corruption as an informational problem when the principal fails to monitor the agent properly (Gurgur and Shah, 2005; Klitgaard, 1988; Marquette and Peiffer, 2015; Rose-Ackerman, 1978). For example, the people are considered the principal as they vote to elect a political representative, who in turn is considered to be the agent. The principal–agent approaches explain the levels of corruption based on information availability problems. The politicians (agents) have a monopoly over information, which in turn can create an information disconnect between the agent and the principal (voters). The principal–agent approaches recommend monitoring political power and competition in the government as a possible solution to corruption (Gurgur and Shah, 2005).
The principal–agent approach has also been used to explore private companies, particularly the likely collusion among the participants (Laffont and N’Guessan, 1999; Tirole, 1996). If the agent can act in such ways that the principal cannot monitor their actions or the agent has access to better information than the principal, corruption can occur (Andersson and Bergman, 2009; Kiewiet and McCubbins, 1991; Mungiu-Pippidi and Dadašov, 2016). An information asymmetry may lead to the agent abusing their public position in ways not explicitly approved by the principal (for instance, corruption) and colluding against the citizens (principal) (Kiewiet and McCubbins, 1991: 25–26). Informational asymmetries can exacerbate corruption with groups or multiple agents or principals (Andersson, 2008; Philp, 2017).
Generally, the principle–agent approach can help explain when and why an individual decides to engage in corruption. However, although micro-level approaches to studying corruption can help advance explanations of a specific action, they tend to focus on only a small part of a much larger political corruption problem. The principal–agent approach is also considered too reductionist (Anderson and Gray, 2006), and agency models ignore the existence of broader institutional structures that could condition agent behavior. For example, Robert Klitgaard’s (1988: 75) classical conceptualization of corruption Corruption = Monopoly + Discretion – Accountability omits important macro-level factors such as the types of political systems and societal attitudes.
Conclusion: where do we go from here?
This article reviewed trends in corruption literature to offer an overview of what we know and do not know about the causes of corruption. The review of corruption literature leads to the following recommendations: we need to integrate macro and micro approaches to understanding corruption and the research should focus on the specific areas that could benefit from additional studies: corruption in western democracies, causes of anti-corruption as opposed to causes of corruption, and local level corruption.
Integrating micro- and macro-level perspectives
Although there have been informative single-approach studies of corruption, neither micro- nor macro-level models by themselves have the capacity to fully account for the causes and persistence of such a complex phenomenon as corruption (Andersson and Bergman, 2009). Classic micro-level or agency explanations regard people’s behavior as dependent on their individual preferences, whereas classic macro-level or structural explanations are considered deterministic, unable to account for the reasons why two individuals in comparable circumstances decide on different courses of action (Pinto et al., 2008; Rothstein, 2011). Scholars cannot fully know whether they should focus on individuals or structures before they begin their corruption research because the individual’s level of autonomy would determine the correct focus (Andersson, 2008). The majority of corruption studies do not analyze both the structures and micro-level elements affecting individual choices, and thus leave gaps in corruption scholarship (Jancsics, 2015; Lambsdorff, 2007). Due to the narrow focus of individual approaches to studying corruption, no single approach offers a comprehensive picture, thus warranting the creation of an integrated model (Gorsira et al., 2018).
The agent–structure (micro–macro) division and the resulting challenges necessitate developing a new approach to studying the association between social actors and institutions in order to explain social behavior given that “the properties of agents and those of social structures are both relevant to explanations of social behavior” (Wendt, 1987: 338). Logically, a research framework incorporating more than one theoretical approach should have a superior explanatory power over a framework with just one approach, because a multipronged model offers researchers multiple views of the phenomenon under study (Peters, 1998).
For these reasons, research studies that adopt an integrated approach in which both agents and structures are included are recommended. For example, combining institutional assessment with analysis of media and its impact on citizens would prove move informative than any single approach. Such an approach would consider both the macro-level perspective of institutions and micro-level perspective of the media’s impact on individual perceptions, contributing to a richer and fuller explanation of why anti-corruption efforts fail.
The traditional principal–agent model can be improved by addressing the challenge of information asymmetry between citizens and public officials in a more sophisticated way by analyzing the specifics of how the media reports corruption. Media analysis is important because, in the principal–agent model, the causes of corruption stem from an information asymmetry where the agents (politicians and public officials) have an information advantage over the principal (the citizens/voters), which can lead to corruption. These negative effects of information asymmetry can be mitigated by the principal having more information and better access to information because citizens’ access to information is the cornerstone of all principal–agent models. A free press improves people’s access to news, which makes it harder for politicians and government officials to hide corruption (Lindstedt and Naurin, 2006). This logic supports the notion of combating corrupt behavior via democracy: citizens, particularly when educated by the media, are able to punish corrupt politicians by voting them out of office (Besley and Prat, 2006). However, existing studies cannot highlight the specifics of the most effective ways for the media to close this information gap. Using the integrated approach to studying corruption in western democracies and cities is likely to produce unique knowledge about corruption and a more nuanced contribution to the corruption literature.
Western democracies, not just developing countries
Public corruption remains a major threat to efficient and responsive public policies across the world. While most corruption stories in the media describe the plight of developing countries, the more developed nations also have their share of corruption. The popular CPI index is possibly the reason why corruption has been largely explored in developing non-western countries. An overview of existing corruption studies shows that corruption is mostly studied in developing countries, which might be contributing to the impression that corruption is a “third world” problem. Thus, a Google Scholar search for the keywords “corruption” and “democracies” from 2000 to 2018 yielded 21,000 results of articles and books mentioning these terms. The same search for the keywords “corruption” and “developing countries” yielded 172,000 results in the same time period. The bias of studying corruption in developing countries is clearly reflected in the academic literature.
However, this disproportionate emphasis on studying developing countries is odd given the recurrent corruption scandals and sliding CPI rankings in western societies. After all, corruption is “endemic in all governments” (Nye, 1967: 417). Allegations of an offer to amend a piece of legislation in exchange for money in Britain’s House of Lords, as well as the case of putting up a senate seat for sale for potential personal and campaign benefits by the former governor of Illinois Rod Blagojevich, illustrate the pervasiveness of high-level corruption in established democracies. Even a country that consistently occupies a spot among the top 10 least corrupt nations according to Transparency International, Finland, experienced a national-level corruption scandal when several parliamentarians admitted they had violated the legislation on disclosure of political campaign finances. Despite the perceptions of corruption affecting mostly poor non-western nations, it is “a pathology most likely to be found thriving in democracies” (Warren, 2004: 328).
We need to acknowledge that corruption is not an epidemic confined only to weak democracies and developing countries. This lack of research on corruption in strong democracies prevents scholars and policymakers from verifying the usefulness of knowledge about the causes of and remedial mechanisms for corruption discovered in developing countries. How will we know if corruption in western democracies requires the same anti-corruption methods as developing countries if we do not study corruption in both? It is important we move away from this bias and study corruption in established democracies. Even countries that receive high scores on the CPI devised by Transparency International, such as Denmark and New Zealand, are not immune to corruption because no country receives a perfect score. A perfect score on the CPI index would imply a complete absence of corruption and, to date, no country has ever achieved this.
Anti-corruption, not just corruption
The majority of corruption studies tend to focus on the causes of or factors that contribute to corruption. Corruption researchers have studied how various elements of governance, such as the quality of democratic or judicial institutions or government transparency, impact levels of corruption. Reading the existing corruption studies makes it clear that the emphasis is on explaining the causes or correlates of corruption. For example, a simple Google Scholar search on books and journal articles featuring the word “corruption” and “anti-corruption” in titles from January 2016 to January 2018 yielded 18,200 and 5590 results respectively. The studies focusing on causes of corruption are important and help policymakers and scholars to understand better what variables could lead to higher levels of corruption, but, at the same time, there is the need to explore specific anti-corruption elements in greater detail.
In theory, knowing what factors cause corruption should help us to design better policies to reduce corruption. In practice, however, the substantial corruption literature and agreements on many factors causing corruption have not helped reduce corruption significantly, especially in developing countries (Bracking, 2008). Corruption persists even when policymakers know what contributes to it. One explanation could be that the policy makers are simply not capable of implementing the required changes (Schmidt, 2007). Changing democratic institutions or revamping judicial systems requires enormous political will and resources. We need to study specifically elements of anti-corruption, especially those that lead to more effective anti-corruption, to obtain a more comprehensive picture of the causes of and remedies to corruption. Several international organizations, including the World Bank and Transparency International, have devoted significant resources to studying anti-corruption, but there is also a need for academics to contribute to the growing body of knowledge. As explained above, the focuses of most anti-corruption efforts and studies tend be developing countries (see for example World Bank, 2017), which is strange given the ongoing corruption scandals in developed countries. Studying factors that contribute to anti-corruption would complement the literature on causes of corruption and would allow researchers and policymakers to obtain a fuller picture of potential remedies to corruption.
Local corruption, not just (inter)national corruption
Additionally, a particularly useful focus on anti-corruption research is the analysis of cities from a comparative perspective. The phenomenon of corruption has been studied primarily at the international or national level and very few studies explore it at a local level. It is therefore not surprising that most anti-corruption recommendations involve international anti-corruption treaties and, by extension, national governments. It is puzzling, however, why most corruption studies analyze corruption based on the national-level framework and without explicit focus on local governments. Although important and necessary, the emphasis on (inter)national factors does not help us to understand the effectiveness of anti-corruption initiatives at the local level. It is an important area to study because “people form opinions about government, decide their level of political participation, and calculate their social capital in terms of what is happening to them in their cities and towns” (Huberts et al., 2008: 3). The nature of public governance and social capital in a community will be mainly determined by where people live and interact with local governments and not by hearing about obscure international conventions. After all, all politics is local (O’Neill and Hymel, 1994). Local governments make decisions on services in areas as diverse as licensing, waste removal, zoning and building permits, construction, and local planning, and these areas are particularly prone to corruption (Andersson, 2008; Transparency International, 2018a).
Furthermore, people typically have more direct contact with their local government officials and politicians than bureaucrats at the national level. Due to the frequency of these contacts, the honesty of local politicians and government officials warrants extra attention and research. Local governments often involve personal ties and have less transparency than national governments, which increases their susceptibility to corruption (DeLeon, 2015). The interaction between levels of government can be complex, with state or regional government involvement in local policies, but the presence of local concern when dealing with the legitimacy of local policymakers is almost always present. There have been few anti-corruption studies focusing solely on cities; consequently, we need more research on local corruption. Although several scholars have begun to address city corruption (see Huberts et al., 2008; Klitgaard et al., 2000) and a few organizations have also embarked on local corruption research projects (such as the Local Integrity Initiative by Global Integrity, 2015), there is still a shortage of corruption research focusing on local governments. The discussions about local anti-corruption systems have remained limited and analytical attempts to compare local anti-corruption policies and institutions are rare.
