1 and Rory Truex2

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Solution Description Benefits Costs

TABLE 3: Outline of Corruption Solutions
Solution	Description	Benefits	Costs	Positive Examples	Key Lessons/Risks
1. External Monitoring and Punishment	Increase audit probabilities and strengthen anti-corruption agencies Increase expected criminal punishments for corruption	Reduction in all forms of malfeasance, most noticeably embezzlement	Costs of audits and other monitoring resources Law enforcement costs and costs of false accusations	Missing expenditures reduced by 8% in Indonesia village audit campaign	Formal accountability mechanisms may be captured by political interests
2. Transparency and Bottom-up Accountability	Increase transparency and provide information to citizens on government services Improve complaint mechanisms	Reduction in leakage of funds Heightened citizen involvement in public affairs	Costs of providing information to citizens and help to organize	Uganda newspaper campaign reduced capture of educational funds from 80% to 20%	Efficacy of transparency is conditional on presence of accountability mechanisms Certain processes may be too complex for citizens to use
3. Internal Controls and Bureaucratic Efficiency	Meritocratic recruitment Foster bureaucratic competition where appropriate Ensure public salaries are competitive, including perks Consider staff rotation Reduce rents in public programs	Reduction in corrupt networks throughout the bureaucracy Better service delivery and revenue collection	Higher wage bill Perhaps some efficiency losses from rotation, bureaucratic competition, & simplification Risk of sale of offices Some tax and customs reform are net revenue raisers	Chile meritocratic civil service reforms in 2003 Lower corruption at Durban port compared to competitors Latin American tax and customs reform	Wage interventions may not always be appropriate Bureaucratic competition may cause substitution across different corrupt behaviors All require interventionsongoing oversight to maintain benefits.
4. Controlling “Grand Corruption” inside States	Enact procedural reforms to standardized purchases and enhance market competition. Develop an e-procurement system on the models of Korea, Mexico and Chile	Cheaper and better quality government purchases and infrastructure Higher return from privatizations	Organizing auctions and bidding systems Ex post oversight by states and IFIs E-procurement likely to pay for itself	Need better empirical studies, but the costs are small and the potential benefits are very large (Korea, Mexico, Chile)	Consider links between grand corruption and both the organization of markets and decisions of which firms to privatize and which projects to pursue
5. Shifting Service Provision to Private Sector	Delegate service provision to private firms using open tender process	Elimination of bureaucracy for certain aspects of service provision Efficiency gains from privatization	Possible loss of service ethos in transfer to private sector Weaker monitoring	Privatization of pre-shipment inspection increases tax revenue 2.6 times India service privatization reduces extortion	Possibility for corrupt transactions in privatization process Private contractors must also be monitored
6. International Initiatives	Introduce international checks through stronger enforcement of OECD Convention, more active debarment processes at IFIs	Better value for money for government projects More competitive international markets	Burden on IFIs and international arbitration system, Costs of a new adjudicatory body	Reforms appear to have potential but generalizations difficult.	Potential for national courts and international arbitration regime to constrain corruption needs to be explored and strengthened

FIGURE 1: Citizens’ Corruption Perceptions (2010)

In the past three years, how has the level of corruption changed?

Note: Data drawn from Transparency International’s 2010 Global Corruption Barometer. NIS+ includes Armenia, Azerbaijan, Belarus, Georgia, Moldova, Mongolia, Russia, and Ukraine.

FIGURE 2: Development and Corruption Levels (2010)

Note: Corruption Perceptions Index drawn from Transparency International website. Human Development Index drawn from UNDP Human Development Reports website.

Directory: fac -> cross fac -> ehrc -> events
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cross fac -> Annotated curriculum vitae
cross fac -> Farm animal welfare: a regulatory history
cross fac -> The Church on the Local Level: Parish and Community in Medieval Linköping Bishopric Anders Fröjmark, Linnaeus University, Kalmar, Sweden

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