corruption and anticorruption reform losing the country or losing the party? corruption in mainland...
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CORRUPTION AND ANTICORRUPTION REFORMLosing the Country or Losing the Party?
Corruption in mainland China: how serious a problem, comparatively speaking? Serious, widespread, growing
Dilemma: widespread corruption as an equilibrium
Anticorruption reform: serious effort, seriously flawed Agency design problem Institutional design problem Constitutional design problem
CORRUPTION: SERIOUS, WIDESPREAD, GROWING
At highest levels of leadership
Across bureaucracies and down to lowest levels
An economic problem Loss of state revenues Lower foreign direct investment
A political problem Public opinion polls Urban and rural unrest
TRANSPARENCY INTERNATIONALCORRUPTION PERCEPTIONS INDEX 2005
158 countries surveyed
CPI index: 0-10, with 0 most corrupt
Least corrupt country: Iceland at 9.7 Most corrupt countries: Chad, Bangladesh at 1.7
United States: 17th, at 7.6 Mainland China: 58th, at 3.2
ANTICORRUPTION ENFORCEMENT, 1979–2000
0
10,000
20,000
30,000
40,000
50,000
60,000
1979 81 83 85 87 89 91 93 95 97 99Year
All cases Cases involving big sums
Trend line without 1980s campaigns
WIDESPREAD CORRUPTION AS AN EQUILIBRIUM
How beliefs sustain widespread corruption Lower transaction costs Lower psychic costs Lower voluntary enforcement by ordinary citizens
Safety in numbers
Anticorruption policy problem Reducing corrupt payoffs Changing beliefs, the “folklore of corruption”
ANTICORRUPTION: AGENCY DESIGN
Two agencies Communist party discipline inspection committees Government procuratorates
Overlapping jurisdictions Procuratorates: criminal corruption Party agencies: all misconduct by party members, include
crimes
Party agency first-move advantage Hoarding or appropriation of criminal cases by party agencies Milder party penalties substitute for harsher criminal
punishments
ANTICORRUPTION CAMPAIGNS
1982, 1986, 1989: corruption overall1993, 1995: big sums and senior officials
Campaigns as “announcements”
To communist party committees Increase cases of criminal corruption investigated
To ordinary citizens Report corruption
To the corrupt Surrender, confess, rat on accomplices
ENFORCEMENT PEAKS IN CAMPAIGNS
0
10,000
20,000
30,000
40,000
50,000
60,000
1979 81 83 85 87 89 91 93 95 97 99Year
All cases Cases involving big sums
Trend line without 1980s campaigns
RESULTS OF ANTICORRUPTION CAMPAIGNS
Enforcement peaks: 1980s, not 1990s Reporting peaks Confession peaks
but
Ineffective deterrence No overall trend of increased reporting
Failure of enforcement, due especially to failure of agency design
OTHER DESIGN CHALLENGES
Institutional design: restructuring incentives Only in recent years
Constitutional design: constraints on power An ever more adaptive communist party?