A theory of symbiotic corruption

Abstract

Symbiotic corruption occurs when senior officials employ the symbiotic relationship with junior officials in corrupt activities, to induce them to participate in the political contest for power and political rents. This paper develops a formal theoretical model to analyze the mechanics and consequences of symbiotic corruption prevailing in weakly institutionalized societies. We find that in the presence of symbiotic corruption, political contests tend to arise when the initial distribution of political rents between rival factions is disproportional to their de facto political power. Anti-corruption by increasing the effective penalty or enhancing monitoring of corruption works differently, but both are surprisingly ineffective in a society plagued by symbiotic corruption. In an unbalanced political system, where the initial distribution of political rents is relatively disproportional, an increase in the effective penalty induces rival factions to reach a tacit collusion to maintain peace and leads to universal symbiotic corruption; a rise in monitoring efficiency decreases total corruption but inevitably increases symbiotic corruption. In a balanced political system, universal corruption always emerges, and anti-corruption only affects the transformation between symbiotic and individual corruptions. This study not only sheds light on the (in)effectiveness of conventional anticorruption measures in the presence of symbiotic corruption, but also provides a new perspective on the link between bureaucratic hierarchies, national-level power dynamics, and corruption.