No Stopping

One of the cleverer economic paper ideas I’ve seen recently.

Cultures of Corruption: Evidence From Diplomatic Parking Tickets
Raymond Fisman & Edward Miguel
Corruption is believed to be a major factor impeding economic development, but the importance of legal enforcement versus cultural norms in controlling corruption is poorly understood. To disentangle these two factors, we exploit a natural experiment, the stationing of thousands of diplomats from around the world in New York City. Diplomatic immunity means there was essentially zero legal enforcement of diplomatic parking violations, allowing us to examine the role of cultural norms alone. This generates a revealed preference measure of government officials’ corruption based on real-world behavior taking place in the same setting. We find strong persistence in corruption norms: diplomats from high corruption countries (based on existing survey-based indices) have significantly more parking violations, and these differences persist over time. In a second main result, officials from countries that survey evidence indicates have less favorable popular views of the United States commit significantly more parking violations, providing non-laboratory evidence on sentiment in economic decision-making. Taken together, factors other than legal enforcement appear to be important determinants of corruption.

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4 Responses to No Stopping

  1. Peter says:

    I think it ill behooves Americans to throw stones at the diplomats of other countries for non-payment of parking fines. The US Embassy in London has refused to pay the London traffic congestion charge, on the grounds of diplomatic immunity, thus incurring fines and penalties, which they also refuse to pay. The amount of money owed to the British exchequer are now so large that the Mayor of London has publicly described the US Ambassador to being like “a little crook”.

  2. Chris says:

    “Taken together, factors other than legal enforcement appear to be important determinants of corruption.” I have to say that this is just one example of what a wierd planet economists live on. Talk about proving the bleeding obvious!

    Andrew, do you really only obey the law because of the threat of legal sanction. Or did your parents and community actually give you some wider moral framework? From the thoughtful nature of most of your posts, it is clear that they did give you such a framework. Yet as a necromancer of the dismal science, you seem impressed by empirical evidence that people make decisions that do not maximise their personal bank balance because they have a wider ethical framework.

    Saw you on Sunday this morning. You are dead right that the educational theorists need some science and data to resolve their disputes. So I guess you like the sort of empirical stuff above. But good science begins with a non-trivial hypothesis.

  3. Christine says:

    I don’t think this is trivial. There’s a question whether high corruption levels in some countries may have to do with lack of penalties for corruption relative to other countries or to some cultural factors (which economists are loath to bring in because almost anything can be attributed to ‘culture’ with no real evidence – protestant work ethic, blah blah blah). (Both authors, btw, have done quite a fair bit of work on the economic determinants and consequences of corruption.)

    So how can you tell whether it’s culture or incentives? Look at behaviour of the different groups in a third country where they face identical penalties – admittedly in this case none at all. If they behave differently there, you’ve actually got some pretty good evidence for the culture argument. Of course, it could still be the case that the lack of penalties in the home country helped cause cultural attitudes, so it’s not entirely a closed case.

  4. Mark G says:

    The notion that corrupt countries have corrupt reps operating from sentiment is a bit of a distraction.

    But turn it on its head. Of the countries that preach stewardship of freedom, personal responsibility, humanitarian ethics, rule of law, enlightenment and education as a basis for international affairs, which posts have reps whose corruption behaviour is actually as bad as or worse than that of the countries in which they are posted? To what extent then are those representatives exemplifying the values they are preaching?

    It’s a good question and a good way to investigate it. The predictive stuff seems to be obligatory, just because it was economists and not say, ethicists, who got to it first.

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