Will Anna Hazare succeed in curbing corruption?

Everyone has an opinion on Anna Hazare and the anti corruption movement; so I guess why should I be left behind? Being a skeptic I decided to look at the whole thing from a more basic and scientific perspective.

Let’s see what Anna Hazare is proposing – he is asking to pass a bill that will supposedly curb corruption. Here I will not comment on his methods and leave them for a future post may be. I will deal with a much more basic premise; can such a bill reduce corruption? The point that is of utmost importance here is Anna Hazare is following a top down approach, not a bottom up approach. Do we really know if the people of India want such a bill? Even lakhs of supporters in a country of 100 crore does not mean much and I’m being very generous in saying that he has lakhs of supporters.

A look at the science now - why do people bribe? I will leave out extortion by the bribe takers because I feel it will not be a stable system unless people are willing to give bribes. One theory is of “Speed money” or efficiency theory of bribes (see Huntington 1968, Lui 1985). This basically says that in a resource constrained setting people will pay bribe for efficiency. For example, let us suppose that you go to passport office to get a passport. The office can issue a passport within 14 days. But you need the passport in 5 days. So you bribe to get it done. This can be generalized in any resource constrained setting where the act of bribing results in a net profit and I use profit in a very general sense, not only monetary. The act of bribing will only stop when the cost of the bribe exceeds the expected profit, otherwise one will stand to lose by bribing.

This brings me to a very interesting study. Recently a study titled “Greasing the Palm. Can Collectivism Promote Bribery?” published in the July issue of the journal Psychological Science showed that companies which belong to countries with collectivist cultures (East Asian cultures) were more likely to bribe. What does this mean? Say there are 10 people standing in a queue and one of them pays a bribe to get ahead; then one or more others standing in the line will also be tempted to pay bribe to get ahead. They would justify it with the reasoning that everyone else is bribing so why shouldn’t I? The act of bribing thus becomes a collective act. Each act of bribing legitimizes the next act but only in a twisted misguided way.

It has also been shown that companies that make more profits also pay higher bribes. This in effect creates a vicious cycle. The company bribes to make more profit (see the efficiency theory of bribing) and with more profits they bribe even more. And the cycle goes on.

So will a top down bill work? All the evidence shows it won’t. So how can we reduce corruption? We begin at the bottom by eliminating the need for giving and taking a bribe.

Further reading:

• Greasing the Palm, Can Collectivism Promote Bribery?
• Ownership, competition and corruption: Bribe takers versus bribe payers.