Corruption Markets: An Analytical Framework for Assessing Anti-Corruption Campaigns

Abstract

Assuming that there is a “missing factor” in the modern corruption studies, authors develop a new conceptual approach to the study of corruption and effectiveness of anti-corruption regulations in the public service. This “missing factor” is a “corruption market”, particularly, its size, type and nature. Conflict of interest regulations aim at controlling key channels of corruption behavior, and corruption market in its turn determines prevailing channels of existing corruption behavior. Misidentification of corruption market’s type is the main reason for the failure of anti-corruption policies, no matter how new and effective models are imported.Corruption market’s size is defined as the number and average price of corruption deal. The nature of corruption market depends on the side, capable of setting the final price of corruption deal. Resulting from institutional characteristics of public administration, corruption markets are either seller’s or buyer’s markets. Seller’s corruption markets are sensible to ethic regulations of public service, and the only effective way of tackling buyer’s corruption markets are “cut-red-tape” reforms and introduction of compliance-based regulation of conflict of interest. Type of corruption market encompasses 3 dimensions: quality of institutions, scope of regulations and degree of regulations. Basing on the introduced model, authors identify and analyze 8 types of existing corruption markets. Each type of corruption market has its own transformational dynamics and, consequently, own opportunities for anti-corruption policies.A new conceptual model of corruption market evolution is introduced in the article. Transformations of corruption markets depend on several factors. The key factors are personalization of political regime, “new public management” reforms of public administration, populist policies and creation of rentier states, and set up of the Welfare State.