Political Corruption and Democracy

Abstract

Are democracies less corrupt than other forms of government? The desire for reelection constrains the greed of politicians. The protection of civil liberties and free speech, which generally accompanies democratic elections, makes open and transparent government possible. In contrast, nondemocratic states are especially susceptible to corrupt incentives because their rulers have the potential to organize government with few checks and balances. But this contrast is too sharp. One need look no further than municipal governments in the United States to find a number of well-established corrupt systems that compare quite well with autocratic systems. Recent payoff scandals have implicated elected politicians in many countries. Clearly, democratic forms do not always succeed in checking corruption. Thus it is worthwhile asking which features of democratic government help limit self-dealing and which contribute to corruption. Democracies based on strong legal foundations provide a stable framework for economic activity. For this framework to operate efficiently, however, politicians must seek reelection and must feel insecure about their prospects, but not too insecure. This leads to a "paradox of stability." Too much security of tenure can further corrupt arrangements. Too much insecurity can have the same effect. A competitive political system can be a check on corruption. For elected politicians the most immediate form of "punishment" occurs at the polls. The electorate may extract a cost even if the payoffs are kept secret. Bribes and illegal campaign donations are given in return for a benefit. Often the quid pro quo is something the corrupt politician would not have done without the payoff.- If politicians vote against the interests of their constituents, they can expect to suffer at the polls. The distinctive incentives for corruption in democracies depend on the organization of electoral and legislative processes and on the methods of campaign finance. I will talk first about the relationship between electoral systems and corruption. Second, I ask how corrupt possibilities are related to the relationship between political structure and private wealth. I conclude with some thoughts on preconditions for reforms in corrupt democratic systems.

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