The Cause of Corruption
By Bryan Caplan
Among the symposium’s exchanges was one between George Mason University economist Bryan Caplan and me about the relative importance of “political culture” and “personal culture” in the development of a thriving economy. I confess to not yet being certain about what the two terms are supposed to mean, but, operating on my guess about the distinction between the two, I wonder what Professor Caplan would do with the problem of corruption.
Here’s an earlier piece where I explain my distinction between personal and political culture. Using the current example, I’d say that the widespread belief that “It is OK for an individual to give and accept bribes” indicates that personal culture is soft on corruption; the widespread belief that “We should not have laws that harshly punish corruption, or hold leaders responsible for the level of corruption” indicates that political culture is soft on corruption.
Kevin goes on:
Obviously it [corruption] increases transaction costs and therefore is a major drain on economic productivity. It seems to me that it is also clearly a matter of personal culture. Not that it is not also a matter of political culture, but that is the point I tried to make in the course of my remarks: one cannot ultimately separate the two.
Corruption is a nice illustration of one of my main claims in the Cato talk: While both personal and political culture matter, political culture matters much more. Even if most people are personally willing to give and accept bribes, they aren’t likely to do so if corruption is harshly punished. And if voters want less corruption, and hold leaders responsible for the level of corruption, leaders have a strong incentive to impose harsh punishments.
Kevin objects that “you can’t separate the two,” but it’s not clear what this means. Are personal and political attitudes toward corruption perfectly correlated? Hardly. So while personal and political attitudes are positively correlated, they are separable. And if they are separable, you can sensibly ask: “Is it better to live in a country where corruption is mildly punished, but perceived to be shameful, or a country where corruption is harshly punished, but not perceived to be shameful?” As I explain in my talk, international comparisons strongly recommended the latter choice.