The Measurement and Impact of Corruption Victimization: Survey Evidence from Latin America

World Development Vol. 34, No. 2, pp. 381–404, 2006 Ó 2005 Elsevier Ltd. All rights reserved Printed in Great Britain www.elsevier.com/locate/worlddev 0305-750X/$ - see front matter doi:10.1016/j.worlddev.2005.03.012 The Measurement and Impact of Corruption Victimization: Survey Evidence from Latin America

MITCHELL A. SELIGSON * Vanderbilt University, Nashville, TN, USA

Summary. — Does democracy suffer when corruption is high? Unfortunately, most studies of corruption have been descriptive, making it difficult to develop a well-supported answer to this question. There are, of course, quantitative corruption measures, but the most popularly used of them are measures of corruption perception aggregated at the national level, rather than corruption experience at the individual level. It is difficult to draw firm conclusions about the impact of corruption from such data. This paper proposes a corruption–victimization measure based on a survey research approach to the measurement problem, and discusses (in a non-technical fashion) its strengths and limitations. The paper then presents data from studies conducted by the Vanderbilt University Latin American Public Opinion Project (LAPOP), and demonstrates the impact of corruption victimization on belief in the legitimacy of the political system, a critical element in democratic political stability. Ó 2005 Elsevier Ltd. All rights reserved.

Key words — corruption, Latin America, survey research, democracy

1. CORRUPTION AS A THREAT TO through television, are driving aspiring politi- DEMOCRACY: IS THERE A LINK? cians to corrupt practices in order to collect the funds needed to pay for TV time. Widespread corruption is increasingly seen as How might corruption threaten democratiza- one of the most significant threats to deepening tion? This is the link that has not yet been spec- democratization in Latin America (and indeed ified, but this paper attempts to do so. Many much of the democratizing Third World). In a claims have been made that corruption is bad recent study, Weyland (1998) views that democ- for democratization, but most of those are racies in Latin America are threatened by an impressionistic. Case studies, especially that of exponential growth in corruption that has oc- Venezuela, are suggestive. In that country, the curred since the dictators of the past have left two mainstream political parties that had the scene. He argues forcefully that corruption shared political power for decades were swept has increased a great deal under democracy in aside by a populist candidate (and former mili- Latin America, and points to several factors tary man). It has been argued that the funda- that are responsible for the increase. First, he mental cause was public outrage over the argues that the dispersion of power in the widely perceived corruption of the traditional hands of many (as has occurred as dictator- party system (Canache, 2002; Canache & Kulis- ships have been replaced by democracies) has heck, 1998). The upshot has been severe social widened the opportunity for bribery. In effect, there are many more ‘‘veto players’’ today than those under the military, and therefore, there * This is a revised version of a paper presented at the has been an increase in the number of palms conference ‘‘Re/Constructing Corruption,’’ University that need to be greased. Second, neoliberal re- of East Anglia, England, April 30–May 2, 2003. I would forms have involved opening many areas of like to thank Nick Duncan for inviting me to that con- the economy to bribery, especially those involv- ference and his helpful remarks on an earlier version of ing sales of public corporations. Third, the this paper, as well as the many helpful suggestions of increasing numbers of neopopulist leaders, Indranil Dutta, Maria Barroń, and Margaret Sarles. who win elections based on personal appeals Final revision accepted: March 9, 2005. 381 382 WORLD DEVELOPMENT turmoil, an ephemeral coup d’etat, and, most zens can seek alternatives to democracy, importantly, a steady weakening of democratic through support for the return of military rule, guarantees (especially the separation of powers) or through support for populist but anti-demo- in that country. At the same time, it is also true cratic figures such as Hugo Cha´vez of Venezu- that over a decade of abysmal economic perfor- ela. Unlike dictatorships, that can employ mance also had weakened support for the almost unlimited coercion to stay in power, mainstream parties, so one cannot be certain democracies rely on popular legitimacy to stay if corruption played a central role in the decline in power, as Lipset and others have argued of democracy in Venezuela. Moving beyond (Easton, 1975; Kornberg & Clarke, 1992; Lip- case studies, there is limited cross-national re- set, 1961). If Weyland is right, and corruption search that links corruption and democracy, is on the rise, one can expect that the nascent but the causal arrows have been reversed. One democracies in Latin America, and by exten- key study (Treisman, 2000), for example, has sion the democratizing world, will have an even shown that over the long run, democratic coun- greater difficulty in establishing and retaining tries become less corrupt, but the reverse has their right to govern. One of the major limita- not been shown, namely, that highly corrupt tions that authoritarian regimes have in estab- countries experience weakened democratization lishing their own legitimacy is that more often or even democratic breakdown. than not they operate as cleptocracies, in which Perhaps the most extensive empirical study to the state is corrupt to its core, and citizens date on the relationship between corruption know it. In a similar fashion, democracies, and democratization is the work of della Porta. based as they are on expectations of account- In a series of papers focused on European ability, may weaken their own legitimacy when countries, corruption has been shown to de- corruption is rampant. crease satisfaction with democracy (della Porta, Is there evidence for this linkage between cor- 2000; della Porta & Meńy, 1996). More recent ruption and the erosion of legitimacy? In fact, work, looking at Latin America, has also the classic research in the field, widely respected pointed to weakening of democracy as a result for many years, argued persuasively for pre- of corruption (Gingerich, 2004). In Japan, cisely the reverse relationship. From that point Pharr (2000) has shown that corruption by of view, corruption serves a very constructive public officials lowers public confidence in purpose in developing countries by establishing democracy. And in Italy, research has shown functional clientelistic ties that bind constitu- that voters can punish corrupt politicians, ents to public officials, allowing relatively low- although they do not always do so (Golden & cost circumvention of dysfunctional bureaucra- Chang, 2001, 2004). cies. In that way, corruption was seen as having These studies, while certainly suggestive of a a positive impact on political systems. As Hun- link between corruption and democratic weak- tington (1968, p. 69) put it most succinctly in ening, suffer from a number of weaknesses, as this classic statement: ‘‘the only thing worse this paper discusses below. In particular, there than a society with a rigid, over-centralized, dis- are two main difficulties: First, the studies focus honest bureaucracy is one with a rigid, over- on the perception of corruption rather than acts centralized honest bureaucracy.’’ The view that of corruption themselves, thus leaving open the corruption helps ‘‘grease the wheels’’ of dys- possibility that even if corruption is at low lev- functional bureaucracies is prominent not only els, if perception is that it is high, democracy in the work of Huntington and classic works could be weakened. Second, and more impor- such as V.O. Key’s Southern Politics published tant, the studies do not demonstrate the mech- in 1949, but also in many more recent studies anism by which corruption could impact (Heidenheimer, Johnston, & LeVine, 1989). In democracy. This paper, by developing a cor- short, according to this view, corruption is just ruption–victimization measure at the level of what the doctor ordered for the Third World. the individual and by showing how corruption Is this argument accurate and does corrup- victimization erodes belief in the legitimacy of tion help ‘‘grease the wheels’’ of the public the political system, hopes to draw the link bureaucracy, thus making it more agile, func- more tightly. tional, and most importantly more responsive The specific argument made in this paper is to public demands? If it does, then one would that corruption weakens democracy by under- expect that more corruption would lead to mining citizen trust in their regimes, in effect, greater accountability and a public that is more delegitimizing them. Once that happens, citi- satisfied with the political system. MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 383

More recent research, empirically based, takes (1) a brief examination of the widespread the opposite approach, one that is consistent use of corruption perception measure; with international donor concerns that corrup- (2) a discussion of an alternative measure of tion is not only unhelpful, but it can do serious corruption experience; damage to both economic growth and demo- (3) an exploration into the level of corrup- cratic development (Rose-Ackerman, 1999). tion detected by the corruption–victimiza- Unfortunately, there are few empirically based tion series, using data from several studies on the subject, and the ones that do exist, countries drawn from the Vanderbilt Uni- do not test corruption itself, but only percep- versity Latin American Public Opinion Pro- tions of corruption. One study on 10 Central ject (LAPOP); and Eastern European countries and Russia (4) an examination of the data to find out supports the linkage, finding that greater per- who the victims of corruption are; ceived corruption relates to lower trust in demo- (5) a discussion of the research that hypoth- cratic institutions (Mishler & Rose, 2001). A esizes about the positive and negative effects more recent study (Anderson & Tverdova, of corruption on governance, providing evi- 2003), based on 16 countries, including the Uni- dence that shows just how dangerous cor- ted States, Japan, New Zealand, and countries ruption is for democratic consolidation, in Western and Eastern Europe, concludes that that is, that corruption matters; ‘‘corruption undermines citizens’ faith in their (6) and finally, the paper will show how cor- governments.’’ In the present paper, these find- ruption levels vary substantially within ings will be supported, but with a direct measure countries. of corruption experienced by individuals who live in the countries being studied rather than with an index of perception of the degree of cor- 2. THE CHALLENGE: MEASURING ruption constructed by external observers. CORRUPTION 1 In order to establish the linkage between corruption and the erosion of support for democ- It is not surprising that, until recently, cor- racy, the paper dwells on the issue of the ruption research has been largely descriptive measurement of corruption. Early on in the rather than empirical. Given its sub rosa nature, international efforts to increase transparency corruption is inherently an extremely difficult to fight corruption, it became evident that in phenomenon to measure—thus presenting a order to know precisely where to expend re- large obstacle for those researchers attempting sources and how to measure the degree of pro- to study it. In other areas of development, it gram success, it was going to be very important is easy to have participants or outsiders list to be able to measure the magnitude of corrup- accomplishments. For example, health workers tion. However, unlike programs in other can report on the number of vaccines adminis- areas—for example, health, where there are tered or healthy babies delivered. We cannot universally accepted objective indicators like in- ask, however, for police officers to report on fant mortality rates and life expectancy—there the number of bribes they take in a given week is not as yet any universally accepted standard or for customs officials to report on how much for measuring corruption. But, unless it is duty goes uncollected. The need to get some known how much corruption there is, whether handle on the level of corruption has led, over it is increasing or declining, little can be done the years, to pursuing different approaches to to target efforts to reduce it. solving this problem, but each approach has In the absence of reliable data on corruption, suffered from its own limitations. it is difficult to target anti-corruption spending. The early efforts were based on official police More important, perhaps, it is that without reli- and court records. One simply counted the able and specific information on corruption, number of arrests and convictions for corrup- one cannot determine what impact, if any, tion in a given country. The main difficulty with anti-corruption efforts are having, which is, that approach, of course, was the spuriousness after all, ‘‘the bottom line.’’ of the measure; the more vigilant the authori- Although constrained by the limited space ties, the more arrests and convictions, produc- available in the format dictated by these short ing a corruption index that was almost research notes, this paper will respond to the completely independent of the corruption level challenge of developing better measures of cor- itself. For example, in highly corrupt countries, ruption in the following six sections: there may be virtually no enforcement, and 384 WORLD DEVELOPMENT therefore, very little corruption is reported, and finds 70 countries—including many of the while in ‘‘squeaky clean’’ countries, there may world’s most poverty stricken—that score less be frequent arrests and convictions for even than 5 out of a possible 10. For comparison, minor infractions. For the most part, this ap- it is important to note that the countries with proach has been abandoned. a score of higher than 9 are Finland, Denmark, In order to overcome the measurement prob- New Zealand, Iceland, Singapore, and Sweden. lem inherent in using official records, two newer As seen in Figure 1, no Latin American country approaches have been taken—each with its own scores that high, with Chile scoring the highest, limitations, however. The first is that carried 7.5. Only one other country scores above 5, out by Berlin-based Transparency Interna- Uruguay (at 5.1), while all other Latin Ameri- tional (TI) with its annual highly respected can countries do worse, placing them among and widely used corruption–perception index the bottom 70 countries out of the 102 on the (CPI). TI is dedicated to generating public list. It is obvious from this information that support for anti-corruption programs and corruption in Latin America, at least as mea- enhancing transparency and accountability in sured by the TI perception index, is a serious government. In recent years, the index has been problem. greatly strengthened due to the use of multiple As illuminating as these results may seem to sources of data and multi-year averages, thus be, we need to consider their limitations. The increasing the reliability of the measure. 2 The scores are based upon a series of surveys con- CPI remains the most widely used measure of ducted by different organizations and include corruption, akin to the Freedom House mea- a measure from the Economist Intelligence sure of democracy. Most economists rely upon Unit, the Pricewaterhouse Cooper’s Opacity the CPI when they examine the impact of cor- Index, and data from Freedom House. These ruption on growth and investment. data sources rely heavily upon the impressions The results of the TI index for Latin America of international business people, who are rea- in 2002 are shown in Figure 1. The index ranges sonably good, albeit limited, sources of data. from a high of 10, in which the country is con- The great strength of these data sources is also sidered to be ‘‘highly clean’’ to a 0, for coun- a weakness—they tap into the perceptions of tries that are considered to be ‘‘highly individuals engaged in international business corrupt.’’ The 2002 report ranks 102 countries, and thus are good at evaluating business trans-

Chile 7.50 Uruguay 5.10 Costa Rica 4.50 Peru 4.00 Brazil 4.00 Mexico 3.60 Colombia 3.60 Dominican Republic 3.50 El Salvador 3.40 Panama 3.00

Argentina 2.80 country Honduras 2.70 Venezuela 2.50 Nicaragua 2.50 Guatemala 2.50 Haiti 2.20 Ecuador 2.20 Bolivia 2.20 Paraguay 1.70 0.00 2.00 4.00 6.00 Score 10 = highly clean; 0= highly corrupt

Figure 1. Transparency international corruption–perception index for Latin America, 2002. MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 385 actions, but they are weak at tapping into the grams, it was scored at 5.2 on a 0-to-10 scale whole range of activities pursued by the citizens by TI. By 2002, however, the Argentine econ- of the countries being evaluated. These activi- omy was in ruins, and its score had plummeted ties are not business related and thus require to 2.8. If Argentina had retained its 1995 cor- a different kind of data. Moreover, a problem ruption score, it would have been ranked sec- with data from such sources is that it is difficult ond in all of Latin America and near the top to separate stereotyping from reality. These of the developing world. But by 2002, it had indexes do not attempt to report on how fre- fallen into the bottom half in Latin America. quently bribery actually occurs in the countries Was that precipitous fall in the index, reflecting being studied but on how corrupt the respon- a putative increase in corruption, a function of dents perceive the countries to be. Of course, a sudden real increase in corruption or did this may be based on their own experience or those who responded to the CPI surveys begin on what they happened to have heard about a to note a discrepancy between low economic specific country. Consider Paraguay—long performance and the TI score of reasonably considered by most experts on Latin America low levels of corruption? If so, it may well be to be an endemically corrupt country. It is also that corruption levels were, in reality, not much a country with very little foreign investment different in 2002 than they had been in 1995 but and very few international business arrange- that respondents to the TI surveys felt the need ments. According to the World Bank, for to adjust their corruption scores to match the example, net private capital inflows for Para- level of Argentina’s economic performance. In guay in 2000 was a negative $16 million and other words, it is likely that the TI corruption total foreign direct investment was only $82 measure on Argentina declined not because million in an economy with a GDP of $6.9 bil- corruption increased, but because the poor per- lion. Foreign direct investment in Paraguay formance of the economy told observers that amounts to only about 1% of the GDP, a level corruption must be higher than they thought only one-sixth of that of its neighbor Brazil. it had been. On the other hand, if we assume How many of the respondents in the surveys that the TI index for Argentina was actually of business people used by the data sources picking up on a sudden increase in corruption whose perceptions were incorporated into the over the period 1995–2002, then this would im- CPI had actually conducted business in Para- ply that decelerated growth actually increased guay? The chances are, not many. Rather it is corruption. However, the logic of the research likely that the ratings of Paraguay are based from the World Bank and others has been just largely upon a stereotype which may or may the opposite; namely, that high levels of corrup- not be closely linked to reality. Furthermore, tion retard growth. If poor economic perfor- while TI draws on 15 different sources for its mance is the cause of corruption rather than data, Paraguay’s results emerge from consult- the other way around, then anti-corruption ing only three sources because so few data programs would be irrelevant since the ‘‘fix’’ sources have a large enough sampling of busi- for corruption would be to spur economic ness people to enable Paraguay to be given a growth. score. Finland, on the other hand, with a pop- In recent years, a very widely used alternative ulation nearly identical to that of Paraguay, to the TI measure has emerged from the World was rated by eight sources. Indeed, an inspec- Bank Institute, which has been releasing a ser- tion of the number of sources used for Latin ies of ‘‘governance indicators’’ that include a American countries as a whole reveals that, measure of ‘‘control of corruption.’’ 3 These with the exception of the largest and richest, indicators are widely cited as the best available most were rated by only a handful of sources, measures of national governance. The results raising doubts about the reliability of the infor- for Latin America are shown in Figure 2.Do mation. we learn something new from these data that A further complication with the CPI is that it we did not know from the TI measure? It is may suffer from an ‘‘endogeneity problem.’’ obvious from comparison with the TI results That is, the results of the CPI may be strongly shown in Figure 1 that the two scores corre- influenced by factors other than direct observa- spond very closely. Indeed, the rank–order cor- tion by participants. Consider the case of relation (Spearman’s rho) between the two Argentina. In 1995, when Argentina was the measures is an almost perfect 0.96. Rarely do darling of the development community, having the social sciences produce such consistent re- progressed rapidly in its privatization pro- sults in indexes based on perception, and we 386 WORLD DEVELOPMENT

Chile 8.99 Costa Rica 8.05 Uruguay 7.74 Brazil 5.66 Peru 5.53 Dominican Republic 5.03 Mexico 4.91 El Salvador 4.65 Argentina 4.53 Colombia 4.47

Panama 4.15 country Venezuela 3.33 Honduras 3.08 Guatemala 2.77 Bolivia 2.58 Nicaragua 2.39 Haiti 2.08 Paraguay 1.32 Ecuador 1.26

2.00 4.00 6.00 8.00

Figure 2. World Bank Institute Corruption-Control Index, 2001/2002. are left with the impression of great precision of larly, an aggregate measure for a country does measurement in these two apparently indepen- not allow development practitioners to measure dent sources. Careful examination of the two the impact of specific anti-corruption pro- data sources reveals, however, that they rely grams. Equally frustrating, the TI and WBI on most of the very same sources from which measures are limited in that they are presented they derive their indexes, explaining why they as relative scores (i.e., ranks and percentiles). 4 arrive at similar conclusions. The problems Consider the situation where the worldwide noted with the CPI, then, are also to be found trend is toward improvement, and an individ- in the World Bank Institute ‘‘control of corrup- ual country has done better from one year to tion’’ measure. the next; if others have also improved, the The lesson from this examination of TI’s CPI impression will be given that the country in and the World Bank Institute’s Corruption- question has stagnated. Moreover, the aggre- Control Index is that one ought to interpret gate, nationwide measures make it impossible their results with care, while recognizing that to know if corruption does in fact erode confi- they are probably the best measures currently dence in the political system, as the World available for a worldwide ranking. If a general Bank argues, or if it has the positive impacts notion of the level of corruption in a country is that Huntington claimed for it. Moreover, na- needed, these measures are, at least for the mo- tional aggregate measures of corruption do ment, the best source. They allow international not allow for an examination of regions or agencies to target the countries with the highest groupings within a country. It is risky to as- levels of corruption and, of course, can provide sume that corruption is uniform throughout a an important tool for investors who want to country, and the data presented in this paper know what they are likely to confront if they in- will show that it is in fact not. If anti-corrup- vest in a specific country. Unfortunately, how- tion programs want to target certain geo- ever, the measures are of limited utility for graphic hot spots of corruption, for example, much of what anti-corruption programs are then national aggregate measures like the CPI trying to accomplish in transparency and anti- are not helpful. If such programs want to target corruption programs because they provide only certain groups demographically, socioeconomi- a national aggregate measure, with no break- cally, or occupationally, the CPI cannot help. downs by type or locus of corruption. These mea- How to solve the problem of finding a measures do not reveal, for any of the countries, sure of corruption that is both valid and sub- those who are most likely to be affected by cor- national? A new approach has been taken by ruption—making it very difficult to design a Harvard’s Susan Pharr, who constructs an cost-effective anti-corruption strategy. Simi- index based on newspaper reports of corruption MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 387

(Pharr, 2000). One advantage of this method is has been spearheaded by the UN Center for that the newspaper articles report where the International Crime Prevention. Implemented corruption occurred and who was involved. in 1987, the International Crime Victim Survey Unfortunately, this measure alone cannot over- (ICVS) now includes 55 countries, with samples come the problem of validity. The accusations of between 1,000 and 2,000 respondents per reported in the articles may be entirely the country. In 1996, for the first time, a question invention of the newspaper staff, whose motiva- was included in the surveys on bribe victim- tions for making the accusation may vary from ization. a desire to increase circulation to an effort to The UN approach represented a good start, weaken one party or candidate and strengthen but a broader series of questions is to be pre- another. Indeed, the newspaper may publish ferred since anti-corruption projects need much stories on alleged acts of corruption because more detailed information about the nature the paper is ‘‘on the take’’ from some political and level of corruption than a single question or business group that wants to make its oppo- could provide. That is precisely the reason be- nents look bad. The classic example of this hind the approach that the LAPOP began comes from Mexico, where Excelsior, for dec- applying in 1996 and the World Bank began ades regarded as the ‘‘newspaper of record’’ using in 1998. These efforts, which may also in that country, was subsequently found to incidentally ask about perception of corruption, have been on the payroll of the PRI (the ruling focus on actual citizen experience (i.e., victim- party) for decades. ization) with public sector corruption. A review of the approach used by the World Bank has been presented as a conference paper (Kauf- 3. MEASURING CORRUPTION mann, 1998). The World Bank studies have VICTIMIZATION been carried out in Nicaragua, Honduras, and, more recently, Ecuador, and, by 2003, Recently, a more promising method has been have been carried out in many other countries developed that largely overcomes both of the around the world. 6 The World Bank surveys limitations of the previously mentioned meth- generally include samples of the national pub- ods. The new approach has been inspired by lic, but also include specialized samples of ‘‘ser- crime-victimization surveys, which have be- vice users’’ and of government officials. In that come the mainstay of sociological investigation way, they are able to get at corruption from a into crime. Criminologists have long recognized variety of angles. Moreover, the World Bank that official reports of crime are highly unreli- has made efforts to calculate the cost of corrup- able because of the likelihood that the data tion by asking respondents to indicate the value have been manipulated. Police chiefs who want of the bribe solicited or paid. The World Bank new patrol cars from their local governments surveys, however, do not include questions on have a strong incentive to help justify the re- attitudes toward democracy, thus making it quest by providing ‘‘evidence’’ that a crime impossible to see how corruption might affect wave has hit the town. To develop this evi- democracy. dence, the police chief may tell his/her officers The effort has been to measure corruption to become especially aggressive when enforcing and its impact. Corruption is measured by di- the law, or it may be that the figures themselves rect personal experience with it. In the course have been cooked. Alternatively, politicians of a public opinion survey of democratic values who want to take credit for successes in fighting and behaviors, which is generally applied to a crime have the incentive to make it appear that probability sample (i.e., ‘‘random sample’’) of crime is on the wane, and salary raises for the the country being studied, a module of ques- police force might subtly be made contingent tions on corruption experience has been devel- upon less aggressive policing. oped and refined since its first application in In order to overcome these intractable prob- 1996. 7 In this approach, respondents are asked lems, criminologists have increasingly come to a series of questions recording their experience rely upon victimization surveys, which are with corruption over the year immediately widely regarded as providing a more accurate prior to the survey. A study of longer time tally of crime rates. 5 That approach is the frames can be attempted, but not only is the inspiration for the current movement to use reliability of memory over long periods prob- surveys of national populations to estimate cor- lematic, it is also especially important to ruption levels. Internationally, this approach limit the time frame so that the impact of 388 WORLD DEVELOPMENT anti-corruption projects and programs can be of actually reporting one’s own bribery experi- picked up in subsequent measurements. These ence with the advantage of deniability. Yet, it surveys, then, include both the key ‘‘indepen- may be possible that these reports of observed dent variable’’ (i.e., corruption victimization) acts of corruption could be inflated—reporting and the key ‘‘dependent variable’’ (i.e., trust more on perception than reality. In analyzing in the system of government) so that the impact the data in this paper, the focus is almost en- of the former on the latter can be measured, tirely on the direct forms of corruption. controlling for other factors (e.g., respondent A second observation about the series of income, education, gender, region, party affilia- questions relates to corruption in schools and tion, etc.). in public health. Focus-group research demon- The forms of corruption measured were strated that users of these services tend to be decided upon based on focus groups and were very well aware of the rules of the game. If, ones that were found to be most commonly for example, primary education is supposed to experienced in Latin America. The items have be free, many citizens consider it corrupt varied from questionnaire to questionnaire, behavior if fees are demanded by the teachers, but the following questions are common to a even if the purpose of the fee is to purchase number of them: books or supplies that ought to come from —being stopped by a police officer for a the state. For that reason, the original question- trumped-up infraction of the law; naire series referred to ‘‘improper payments’’ in —being asked to pay a bribe 8 to a police the schools or health clinics. However, some officer; critics of these questions suggested that these —observing a bribe being paid to a police payments were not really signs of corruption officer; but merely a reflection of the poor state of pub- —observing a bribe being paid to a public lic financing of human services. In order to fo- official; cus directly on corruption itself, these items —being asked to pay a bribe to a public have been altered in the most recent adminis- official; trations of the questionnaire, and the term ‘‘im- —being asked to pay an illegal fee to expedite proper payments’’ was dropped and ‘‘bribes’’ a transaction at the municipal government; substituted. This change resulted in a small de- —being asked to pay a bribe at work; cline in reported acts of corruption in the health —being asked to pay a bribe in the court service and a somewhat larger decline of re- system; ported acts of corruption in the school system. —paying bribes to a public utility to avoid Yet, even with these adjustments the levels re- paying the full bill; main distressingly high, as will be shown below. —being asked to pay a bribe in the school The analysis of the corruption–victimization system; and data has been carried out in two ways. First, —being asked to pay a bribe for services in when the particular form of corruption is the the public health/hospital system. focus (in order, perhaps, to develop an anti-cor- The reader will note that most of the items in ruption campaign targeted to each specific form the series focus on corruption directly experi- of corruption), individual items are chosen to enced by the respondents but that some of them be analyzed so that the particular form of cor- focus on the respondents’ observations when ruption can be highlighted. The second ap- bribes were being paid by others. We have la- proach is to form an overall scale of beled this as ‘‘indirect’’ or ‘‘vicarious’’ corrup- corruption so that the total experiences can be tion. In each country where the survey has examined and linked to their impact on individ- been applied, it was found that direct, personal ual variables, such as political legitimacy. When experience with corruption is less frequent than formed as a scale, the items have been found to indirect or vicarious experiences. The reason be reliable (Cronbach Alphas of around 0.75, for this could be that individuals may be und- depending on the country). erreporting their own experience with corrup- In approach to corruption victimization pre- tion out of fear that reporting it could get sented here, national samples have been used. them into some sort of legal trouble. Focus- The World Bank, however, which has also car- group research has shown that an underreport- ried out national samples of corruption victim- ing problem exists but is surprisingly limited. ization, has included specialized samples of On the other hand, saying that one observed individuals in various sectors, such as the busi- someone else paying a bribe might be a way ness world or various sectors of the state. The MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 389 advantage of the World Bank approach is that top. It is simply not reasonable to imagine it allows an even finer-grained targeting of anti- that a political system that is very corrupt corruption efforts; the disadvantage, of course, at the level of day-to-day transactions is cost. (police, local government, schools, banks, etc.) would be squeaky clean at the top. Sim- (a) Limitations of the corruption–victimization ilarly, it is difficult to imagine the reverse sit- measure uation with a highly corrupt senior administration combined with an absence No system of measuring attitudes or behav- of corruption down on the street. Since there iors is without limitations, and the corrup- seems to be no reasonable way to directly tion–victimization measure suffers from two measure high-level corruption (rather, only of them, which will be pointed out here. the perception of that corruption), the vic- —Are all survey respondents who report timization approach used by the Latin having paid a bribe really ‘‘victims?’’ Per- American Public Opinion may be the best haps some bribe payers are not victims at instrument currently available. all but in fact are willing participants in the transaction, deliberately seeking to cir- (b) Perception and corruption victimization: cumvent rules and regulations in order to Are they linked? advance their own objectives. Such individuals, then, may not be ‘‘victims’’ but willing The corruption–victimization surveys always ‘‘clients’’ in a patron/client relationship with also ask at least one question regarding the the bribe taker. On the other hand, if the respondent’s perception of corruption and system were both fair and efficient, there therefore provide for a test of the putative link- would be little reason for citizens to become age between corruption perception (the basis of clients. If the police did not regularly stop the TI CPI) and the fact of corruption as expe- motorists in Latin America who have done rienced by residents of the countries included in nothing wrong, then there would be no rea- the TI series. Are the two linked? Yes and no. son to offer to pay a bribe. Similarly, in By examining Figure 3, one can see that as cor- instances when the motorist actually com- ruption victimization increases, there is a signif- mits a traffic infraction and seeks to avoid icant increase in the perception of corruption a ticket and the corresponding fine, an hon- on the part of individuals in the countries in- est police officer would not demand or cluded in this series. Yet, it is important not accept a bribe. If the public sector were both to overstate this finding because on a 0–100 fair and efficient, individuals could easily scale, for all four countries in this sample, all obtain the service they are seeking (e.g., a averages are in the 60–70 range for respondents permit from the local government) and there who have not had any direct personal corrup- would be no need to pay a bribe. Addition- tion experiences within the 12 months prior to ally, if one sought to avoid paying a large, their being surveyed. In other words, even legally established fee for a service and the though respondents to these surveys have not public officials were honest, no bribe would been personally affected by corruption, at least be accepted. In short, while it is always pos- in the year prior to the survey, they nonetheless sible to view corruption ‘‘victims’’ as corrup- generally view corruption as being extensive in tion ‘‘partners,’’ bribery would be largely their countries. In contrast (with the exception futile if not for the inefficiency and complic- of Paraguay), even among those who had been ity of a corrupt public sector. victimized two or more times in the past year, —The survey approach is flawed because it the increase in the level of perception of corrup- measures only low-level corruption, but is tion is quite small, generally fewer than 10 incapable of measuring much high-level cor- points on a 100-point scale. More troubling still ruption. This critique is valid, but only to a for those who wish to rely on corruption per- limited degree. It is true that surveys of the ception is the case of El Salvador, where those public do not measure—nor do they attempt who had experienced the highest frequency of to measure—high-level corruption (e.g., corruption had a somewhat lower perception bribes paid to ministers or legislators). But, of the degree of corruption than those who it would be a serious error to assume that had been victimized only one time. low-level corruption is not strongly corre- These findings caution us to be very careful lated with the degree of corruption at the when estimating corruption on the basis of 390 WORLD DEVELOPMENT

100

40 Paraguay 30 El Salvador 20 Mean perception of corruption Nicaragua 10 0 Bolivia None One Two or more Number of direct personal experiences with corruption All sig. < .05

Figure 3. Impact of corruption victimization on perception of corruption. perception rather than experience since the two available for many countries. When using these may not have a close fit. Moreover, in countries broad measures for specific developmental pur- in which a major effort to reduce corruption has poses, however, considerable care must be ta- been successful, it may well be that the cam- ken or these measures of perception could paign to do so heightens awareness of corrupt become reified. practices and therefore might produce an increase in the perception of corruption precisely (c) Corruption victimization in six at the time when actual corruption is declining. Latin American countries The point becomes even more obvious in Fig- ure 4, where a direct effort was made to see (i) How frequent is it? how a perception-based measure tracks with The surveys of Latin America reveal that cor- actual corruption experience. As is evident ruption is widespread and emerging in many from the results, although corruption varies different forms, some more frequently experi- substantially from country to country in the enced than others. This paper, which can only six-country sample, perception has only a weak highlight a small portion of the data because relationship to victimization levels. If one were of space limitations, focuses on direct corrup- to use perception as the measure, for example, tion victimization rather than observed corrup- one would conclude that there is more corruption. tion in El Salvador than in Bolivia, when in fact One very common way in which corruption it is very clearly the other way around. The ac- affects Latin Americans is through the very offi- tual TI ranking for these countries does cor- cials who should be involved in controlling it— rectly show that Bolivia is worse than El namely, the police force. The results shown in Salvador, but while Bolivia scores 2.2 on the Figure 5 reveal that over one in four Bolivians 1–10 scale (see Figure 4), El Salvador scores have been stopped annually by a police officer only slightly better at 3.4. The corruption–vic- and asked to pay a bribe. In contrast, this hap- timization scale in Figure 4 shows that Bolivia pens to only 3% of the population of El Salva- has a level of corruption more than four times dor. Respondents in these countries were also that of El Salvador. asked about being asked to pay a bribe by a However, these comparisons do not make the public official, and the comparative results are indexes generated by TI and the World Bank shown in Figure 6. Once again, consider the ex- obsolete, as they are the only ones currently tremes—El Salvador has a 4% corruption–vic- MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 391

100

77 75 71 69 69 60 64

40 How common Index value are bribes?

27 20 22 19 Index of corruption 15 5 victimization 0 9 El SalvadorHondurasNicaraguaEcuador Paraguay Bolivia

Spearman's rho = .098, sig. < .001

Figure 4. Do national level perceptions of corruptioin track with corruption victimization?

30%

20%

% solicited bribe 10%

7 6

3 0% El Salvador Nicaragua Bolivia Honduras Ecuador Sig. < .001

Figure 5. Police officer solicited a bribe. timization rate and Bolivia has a 28% rate. But emerges here is the large gap in corruption vic- also consider the consistency with which the timization between Central America and South countries are ordered; the only difference be- America, with the former being far lower than tween bribes solicited by police and bribes solic- the latter. ited by the more generic ‘‘public employees’’ is The survey also collected information on in- that in the later instance, data are available stances of corruption in specific settings. For from Paraguay, which is found to have corrup- example, respondents were asked questions tion levels somewhat lower than Bolivia but about being asked to pay a bribe at work (Fig- higher than Ecuador. The overall pattern that ure 7). What is striking about these results is 392 WORLD DEVELOPMENT

30%

20% 21

19 % solicited 10%

6 4

0% El Salvador Nicaragua Paraguay Honduras Ecuador Bolivia

Figure 6. Public employee solicited a bribe.

Bribe solicited at work 14%

13 12%

11 10%

6% % victims 6

4 3 2%

0% Honduras Nicaragua Bolivia El Salvador Ecuador

Figure 7. Bribe solicited at work. how much lower they are than those of public- retired, unemployed) and thus did not have the sector corruption (compare with ﬁgures above). opportunity to be subjected to work-place It might be assumed that these low levels are a bribery. 9 If, however, the analysis is limited function of the fact that signiﬁcant percentages to employed respondents, corruption levels do of respondents are not employed (i.e., students, increase, but not by much, leading to the con- MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 393

30%

22 20%

% victims 13 10%

0% El Salvador Bolivia Paraguay Honduras Nicaragua Sig. < .001

Figure 8. Bribe solicited in the courts. clusion that corruption in the workplace is sim- the World Bank Institute perspective (Ecuador ply not as common as it is in interactions with ranks last in Latin America on corruption con- the public sector (as shown in Figures 5 and 6). trol in the World Bank data). The survey re- Bribery in the courts varies widely from sults for Ecuador show that one-fifth of its country to country (as shown in Figure 8). In adult citizens who carry out a transaction with places like El Salvador, it seems to be very the local government pay bribes when doing so, uncommon, whereas in Paraguay, it is very over one-quarter of the users of courts have frequent. 10 been asked to pay bribes, and over one-third Recently, the World Bank Institute has been who use public health services and two-fifths focusing on bribery at the level of users of ser- of users of public education facilities pay bribes vices. In the questions analyzed thus far, all cit- there. 11 These results are disheartening as they izens are, at least in some fashion, users of indicate that those who use a public service in police services. But not all (or even most) citi- Latin America need to expect to be asked to zens make use of the court system. In order pay a bribe. to focus on users of public services, the LAPOP has recently been adding questions to its (d) Who are the victims? Variation within survey. countries The respondents are first asked if they use the service, and then they are asked if they have Victimization by corruption is not uniform had to pay a bribe to use that service. Questions across the populations of the countries in which have been asked regarding bribery when carry- it occurs. On the whole, males are much more ing out a transaction at the local municipal likely to be victimized by corruption than fe- government, using the court system, sending males. As shown in Figure 10, for the general children to public schools, and accessing a pub- item on having a public employee solicit a lic health service (e.g., clinics and hospitals). bribe, in every country except Honduras, males The results for Ecuador are shown in Figure 9 are significantly more likely to be corruption and are very disturbing. It should be kept in victims than females. In El Salvador, although mind that Ecuador has already shown itself to the overall level of corruption is relatively be a high-corruption country, at least when low, the gap is proportionately very wide. How- compared to Central America, based on the ever, this is largely because males make greater LAPOP data and also when considered from use of many public services than females. As 394 WORLD DEVELOPMENT

50%

40% 41

35 30%

27 % victimized

20% 20

10% Municipality Health service Courts School Sig. < .001

Figure 9. Bribes solicited from users of services: Ecuador.

40%

30% 30

23 20% 21

15 16

10% Gender 10 Mean Public employee bribe

6 Male 6 6 5 0% 2 Female El Salvador Nicaragua Paraguay Honduras Ecuador Bolivia All sig. except Honduras < .05

Figure 10. Impact of corruption on gender: six countries, public employee solicited bribe. shown in Figure 11, in Ecuador, where the sur- come increases, the probability of being a cor- vey data make it possible to focus on the subset ruption victim increases sharply. Those with of service users, the gender gap is much nar- higher incomes are two or three times more rower and males are not signiﬁcantly more likely to be victimized by corruption than those likely to be victimized than females in Ecuador with low incomes. 12 Of course, those with (among users of the municipality, courts, and higher incomes invariably have more business health services) but only somewhat more likely to transact, more permits and permissions to to be victimized by the school system. request, and as a result, come into more fre- Those seeking bribes know where to ﬁnd the quent contact with the public bureaucracy. In- ‘‘deep pockets.’’ Figure 12 shows that as indeed, they may be more likely to be seeking MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 395

50%

44 40%

39 37

30% 32 30 % victims

24 20% 21 Gender

18 Male

10% Female Municipal Courts Health School Only school corruption sig.

Figure 11. Impact of corruption on gender: service users in Ecuador.

50%

40%

30%

% victims 20%

COUNTRY 10% Paraguay

0% Ecuador Income Sig. < .001

Figure 12. Respondent income and public employee solicitation of bribes. ways to pay bribes in order to acquire a given surveys do not measure the dollar value of service. At the highest income levels, victimiza- bribes, it may be that while the rich pay bribes tion seems to taper off, at least in Ecuador and more frequently than the poor, that the relative Paraguay, perhaps because the individuals in- cost to them is lower than it is for the poor, volved are wealthy enough to be able to use making bribery regressive. This has been a find- political influence to achieve what they need ing of the World Bank. out of the system and do not have to confront There is also a life-cycle effect that determines outright bribery. It may also be that at the who the corruption victims are likely to be. highest level of income in the survey, respon- Typically, the youngest respondents in the sur- dents have more to hide, and therefore they re- veys are somewhat less likely to be corruption duce their reporting of corruption. Since the victims. Once they move out of their parents’ 396 WORLD DEVELOPMENT homes and set up their own families, however, (Figure 14), where there are much higher over- they have greater contact with the bureaucracy, all levels of corruption than El Salvador, the and corruption victimization increases. On the peak is also reached in the 20s but continues other hand, once Latin Americans age and be- high until middle age, when it then falls gin to withdraw from active engagement with sharply. the larger society, corruption victimization Although there are many other demographic falls. In El Salvador (Figure 13), corruption vic- and socioeconomic patterns that corruption timization peaks abruptly in the 21–30 year age victimization follows—a number of which are group, and then falls off sharply. In Bolivia found in the various country-focused reports

5 National average

3 Mean experience with corruption

2 18-20 21-30 31-40 41-50 51-95 Age Sig. < .001

Figure 13. Personal experience with corruption and age: El Salvador.

28%

26%

24%

22%

20% % victimized

18%

16%

14% 18-25 26-35 36-45 46-55 56-65 66+ Age Sig. < .001

Figure 14. Corruption victimization and age: Bolivia. MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 397 of the LAPOP—only one remaining key finding combined index. All three measures show the will be covered in this brief overview. Urbani- same general pattern (Figure 16). zation greatly increases exposure to corruption. The findings from Honduras in the figure In Bolivia, corruption is much higher in urban provide clear guidance to those who wish to areas than it is anywhere else in the country examine sub-national variation in corruption. (Figure 15). In Honduras, the same pattern is Even though both Tegucigalpa and San Pedro found, but in this case, the results compare Sula are the country’s only large urban areas, three different measures of corruption: hearing the corruption victimization in the Tegucigalpa or observing corruption, being a victim, and a area, the seat of the central government, is far

30%

28%

26%

24%

22% Corruption index 20%

18%

16% Urban >20,000 Rural 500-1,999 Urban 2,000-20,000 Dispersed rural Sig. < .001

Figure 15. Corruption victimization and urbanization: Bolivia.

40%

30%

20%

Heard/saw % victimized 10% Total index

0% Personal victim Tegucigalpa Tegucigalpa San Pedro Sula Department capitalMunicipal capital Rural area

Location of interview Sig. < .001

Figure 16. Corruption victimization and urbanization: Honduras. 398 WORLD DEVELOPMENT higher than that found in San Pedro Sula. The really the margin of error produced by the sam- appropriate conclusion from this finding is that ple. This means that the average corruption it is not urbanization per se but the presence of score shown for each department, represented government that has had the major impact on by the square box, is surrounded by a band corruption levels. But, it is important not to above and below the point that represents the lose sight of other factors, including regional range in which, 95% of the time, the actual traditions that influence the level of corruption. average would be found if the survey had inter- It has already been shown, for example, that viewed the entire population. Confidence inter- corruption victimization varies by age and in- vals help distinguish differences among come, and other reports in the series have departments that are merely a function of the shown that it varies by wealth as well. What sample design and those that are true differ- happens when all of these factors are controlled ences. Thus, as Figure 18 demonstrates, for for, and corruption levels are examined net of example, Oruro and La Paz have significantly them? Figure 17, which shows graphical varia- more corruption than El Beni, but Coc- tion in corruption in Nicaragua, reveals that habamba’s confidence interval overlaps that there is a hot spot that includes the country’s of La Paz, and therefore, the two should be as- capital, Managua. But it is also clear that regio- sumed to be insignificantly different from each nal traditions play a role; otherwise, it would be other. impossible to explain the very low level of cor- An overall pattern emerges in these findings; ruption victimization in the department of those who use the public sector more frequently Leoń, which borders on Managua, and the high are more likely to be victimized by it. This level of corruption in the department of Chi- seems to be a trivial truism, until one pauses nandega on its other border. It is also clear that to think about the impact this has on the polit- regional traditions matter in Bolivia, where the ical system—the more Latin Americans use department of Oruro has higher corruption lev- their government the more likely they are to els than the national capital, La Paz. The re- be victimized by it. The implications for erod- sults shown in Figure 18 are presented along ing public confidence are obvious and will be with their ‘‘confidence intervals,’’ which is shown empirically below.

RAAN Nueva Segovia Jinotega

Madriz

Estelí Chinandega Matagalpa

León RAAS Boaco Managua Chontales Masaya Granada Carazo

Rivas

Rió San Juan

Figure 17. Corruption experience in Nicaragua: residuals controlled for age, income, education, and wealth. MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 399

40%

30%

20% % victimized

10%

0% N = 295 402 297 397 400 289 294 298 300 Oruro La Paz Potosí CochabambaSanta Cruz Pando Tarija Chuquisaca El Beni

Figure 18. Public employee solicited bribe: conﬁdence intervals by department in Bolivia.

4. CORRUPTION ERODES POLITICAL Corruption surveys, though embryonic, ap- LEGITIMACY pear to be the most promising of the efforts undertaken to date to test the corruption/ero- One of the most frequently heard comments sion of the legitimacy thesis. As discussed in is that corruption erodes trust and confidence this study, these surveys obtain corruption in the political system. Typical of those who de- experience data at the level of the individual cry the negative effects of corruption, the World while simultaneously obtaining information Bank frequently argues the thesis, ‘‘Corruption from those same individuals about their belief violates the public trust and corrodes social in the legitimacy of their government. The ana- capital... Unchecked, the creeping accumula- lytical task, then, becomes searching for the tion of seemingly minor infractions can slowly connections between corruption experience erode political legitimacy.’’ (World Bank, and legitimacy beliefs after appropriate control 1997, pp. 102–104). Unfortunately, although variables are introduced. the Bank presented substantial evidence that Latin America, where currently there is corruption negatively affects the economy, it extensive attention focused on corruption, is a provided no support for the claims that minor good place to test the hypothesized relationship corruption (or even major corruption) erodes between corruption and legitimacy for two rea- political legitimacy. While the Bank has pre- sons (Tulchin & Espach, 2000). First, as shown sented a great deal of evidence on the level of at the outset of this paper, this is a region of the the independent variable (corruption), it has world frequently found to have high levels of presented no corresponding evidence on the corruption. Second, Latin America has long dependent variable (political legitimacy). The had problems of political stability, suffering a more recent World Bank Institute studies, as seemingly endless succession of coups through reported above, use a multi-index measure of much of its history (Seligson & Carrioń, governance, including perceptions of corrup- 2002). If, as Easton (1975) and also Lipset tion worldwide, and have found that per capita (1994) and Lipset and Lenz (2000) have argued, incomes are lower and infant mortality and legitimacy is a fundamental requisite for demo- adult illiteracy are higher when governance is cratic stability, then it is plausible that legiti- poor (Kaufmann, Kraay, & Zoido-Lobatoń, macy is questionable in many Latin American 1999). Yet once again, there is no effort to link countries. From an empirical point of view, corruption on the one hand and political legit- considerable evidence exists to show that legitimacy on the other. imacy levels remain low in many countries in 400 WORLD DEVELOPMENT the region despite 10 or more years of demo- ing the bribe not as an appropriate user fee, but cratic rule (Seligson, 2000). as what economists call a ‘‘DUP,’’ a directly Legitimacy is measured in the surveys by a unproductive profit-seeking activity, otherwise scale of diffuse support attempting to tap into known as rent seeking. When a municipal clerk confidence in the key institutions of govern- asks for a payment above and beyond the offi- ment (Muller, Jukam, & Seligson, 1982; Selig- cially established fee to process a birth certifi- son, 1983). The scale is based on five items, cate, the payment represents a surplus value each scored on a metric of 1–7. The items, ini- above that of the established price, and hence tially developed in studies of Germany and the can be considered rent-seeking behavior. Rent United States and refined in several studies of seeking is possible only because those demand- Latin America, sought to tap into generalized ing the rent (in the form of a bribe) have been support for the basic institutions of government given state license (unofficially) to do so. We rather than support for the incumbent govern- can predict, therefore, that individuals who ment (Muller, Seligson, & Turan, 1987). view such fees as rent seeking are likely to form Respondents were asked (1) ‘‘To what extent negative views about the state. do the courts guarantee a fair trial?’’ (2) The empirical results to test these two possi- ‘‘How much respect do you have for the polit- ble reactions are presented in detail in a study ical institutions of the country?’’ (3) ‘‘How (Seligson, 2002) in which several countries from much pride do you feel living under the politi- the data set are examined. For the purposes of cal system of the country?’’ (4) ‘‘How much this brief summary, the results of Nicaragua, support do you have for the political system which parallel those from the other countries, of the country?’’ and (5) ‘‘How much trust do can be examined. The overall legitimacy scale you have in the police?’’ In order to make the declines steadily as corruption victimization in- metric consistent with the range of the corrup- creases, declining from above the national tion-experience measure, the items were mean for those who had not been victimized summed into an overall scale and transformed by corruption to one standard deviation below into a 0–100 basis. The overall scale was reli- the national mean (Figure 19). One especially able for each country as well as for the pooled relevant item from the legitimacy scale, the be- data (Pooled standardized item Cronbach’s lief that people can get a fair trial, clearly dem- Alpha = 0.78; mean interitem r = 0.37). onstrates that corruption does erode confidence The first task is to determine if corruption has in the system (Figure 20). a negative or positive impact on legitimacy. These results show that those who experience When a citizen pays a bribe to either receive a corruption are less likely to believe in the public service or to avoid sanctions from an ac- legitimacy of their political system, thus con- cused violation of law, two reactions could firming the World Bank speculation and refut- emerge depending upon how the bribery is per- ing the Huntington hypothesis. Research with ceived. On the one hand, the bribe could be these data sets have found that corruption vic- viewed as a ‘‘user fee,’’ much like the fee one tims are also less likely to exhibit high levels of would willingly pay to use a toll road or a camp- interpersonal trust, a possible important social– ground. Those who pay such fees might view the psychological contributor to belief in legiti- assessment and payment as an entirely legitimacy. Interpersonal trust has been linked to mate transaction, implying no negative evalua- successful efforts to build civil society and, as tion of the political system. Indeed, an Putnam (1993) terms it, to ‘‘make democracy individual who pays a ‘‘processing fee’’ in order work.’’ to facilitate the granting of a driver’s license, for These findings demonstrate that there are example, might be pleased with a system that al- real costs to corruption overlooked by the func- lows the granting of such licenses even when the tionalists who argued for the positive benefits requisite requirements (vision test, driving skills of it and by those who believe the clientelistic test, etc.) have not been met. Or the individual ties based on corruption can breed political sta- may feel that the salaries paid to public officials bility. They do not, of course, demonstrate that are properly kept low so that overall taxes re- government operates less efficiently as a result main low, but those who use the service ought of widespread corruption, for to do so would to legitimately pay these user fees so as to sup- involve a study beyond the scope of public plement the salaries of public officials. opinion and take us back to the economic liter- Those asked to pay bribes may have an en- ature. Some of the survey data do, however, tirely different reaction to the experience, view- allow us to determine respondent beliefs about MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 401

Mean legitimacy

20 1Std. Dev. Legitimacy scale

0 0 1 2 3 4 5 6 7 Corruption victimization scale Sig. < .001

Figure 19. The impact of corruption victimization of legitimacy in Nicaragua.

3.4

3.2

3.0

2.8

2.6 Mean fair trial 2.4

2.2

2.0 0.00 25.00 50.00 75.00 100.00 Total personal experience with corruption Sig. < .001

Figure 20. Belief in ability to get a fair trial in Nicaragua and total personal experience with corruption. the efficacy of corruption and then to determine tion is positively associated with our index of the impact of that belief on system support. victimization by corruption (r = 0.21; sig. < In the Nicaragua survey, we asked a straight- 0.001), suggesting that those who have direct forward operationalization of the functionalist experience with corruption are more likely to argument: ‘‘Do you believe that the payment believe that it gets them what they need. Yet, of bribes facilitates getting things done with belief in the efficacy of corruption does not the bureaucracy?’’ Among the 85% of the sam- translate into a positive view of the political ple who responded to this question, 60% agreed system—quite the contrary, in fact. Those who with it, indicating fairly strong support within agree that corruption helps get things done with Nicaragua for the belief that bribery works. the bureaucracy are significantly less likely to Moreover, belief in the functionality of corrup- believe in the legitimacy of the political system. 402 WORLD DEVELOPMENT

These results show that corruption erodes sup- able to show who its victims are and to demon- port for the system even among those who rec- strate that those who saw corruption as build- ognize that it may have some utility in ing ties between rulers and the ruled were overcoming bureaucratic barriers. wrong. Corruption does indeed erode the legitimacy of democracies. It follows that if corruption increases, as Wayland argued, at the outset 5. CONCLUSIONS of this paper, erosion of support should also be occurring. It is also shown in this paper that In order for political systems to function rea- corruption lowers interpersonal trust, presum- sonably well, actions taken by leaders need to ably negatively affecting civil society relations. be viewed as legitimate. If not, the ‘‘degrees of On the positive side, there is some recent evi- freedom’’ with which decision makers have to dence that over the very long run democratic operate are reduced considerably. Immobilism countries become less corrupt, but the observed is a potential outcome of political systems in effect took place over half a century, more years which the public does not believe in the legiti- than many fragile democracies may have to macy of the system. In extreme cases, which spare (Treisman, 2000). It would be the ulti- have frequently occurred in Latin America, mate irony that an artifact of the rise of democ- governments are swept aside by popular pro- racy itself may help contribute to its own tests or military coups that are supported by weakening in the developing world. That is all much of the public. the more reason to be concerned about the This paper has emphasized the importance of problem of corruption and to find ways of measuring corruption experience in order to be reducing its prevalence.

NOTES

1. This section draws on Seligson (2002). South Africa under apartheid, where the murder of blacks was often not reported by the police, or in 2. These efforts are explained in detail in the TI countries undergoing civil wars where record-keeping website. The specific document that presents the meth- functions often break down entirely, are these rates odological issues is www.transparency.de/documents/ unreliable. cpi/cpi_framework.html. 6. See Comite´ Nacional de Integridad and World 3. These data are easily available at http://www.world- Bank-CIET International (1998). See also World Bank bank.org/wbi/governance/govdata2001.htm. The origi- (2000). nal data are listed as a 0–100 percentile rank and have been converted here to a 0–10 score to correspond to the 7. The surveys reported on in this project are all CPI 0–10 format. national probability samples carried out at various times from 1998 through 2002 in El Salvador, Hondu- 4. The WB web site (http://www.worldbank.org/wbi/ ras, Nicaragua, Ecuador, Paraguay, and Bolivia. A web governance/govdata2001.html) states: ‘‘As discussed in site is currently being constructed where this data can detail in the accompanying papers, countries’ relative be easily accessed. The samples each have between positions on these indicators are subject to margins of 2,500 and 3,000 respondents, except for Paraguay, error that are clearly indicated in the data files and which included only 1,463. The first survey, conducted graphs downloadable below.’’ One reviewer of this paper in Nicaragua, was developed with Casals and Associ- argued that the WB measures are ‘‘objective scales,’’ ates. I would like to thank Dr. Sergio Dias Briquets of when in fact, the WB states on its web site that the Casals and Dr. Andrew Stein, now of the US Depart- indicators ‘‘reflect the statistical compilation of percep- ment of State, for assistance in that early work. Dr. tions of the quality of governance of a large number of Orlando Pe´rez of Central Michigan University has enterprise, citizens, and expert survey respondents.’’ assisted in more recent studies in Honduras and These measures should not be confused with the WB Ecuador. studies of corruption experience. 8. The word for ‘‘bribe’’ in Spanish differs among the 5. Homicide rates, however, are used as reliable indi- countries sampled. In Central America, the survey cators of one form of extreme crime. Only in places like generally used ‘‘mordida’’ while in South America the MEASUREMENT AND IMPACT OF CORRUPTION VICTIMIZATION 403 word ‘‘coima’’ was utilized. In both areas, however, the bribes in particular, while the question dealing with local additional term ‘‘soborno’’ was utilized. government focused on ‘‘payments above what the law requires.’’ In a subsequent study in Ecuador, it was 9. Some respondents might have worked at some point found that if the word ‘‘bribe’’ was substituted for these during the year prior to the interview but were not phrases, the reporting of corruption decreased some- working when the survey took place. Those individuals, what. For example, in a special sample focusing on 15 therefore, could have been subjected to corruption at municipalities in Ecuador (N = 4,500), bribery in the some point during the year prior to the survey. municipality was found to be 17.4% compared to the 19% reported in Figure 11. 10. Ecuador is excluded from this series because a slightly different question was used there. 12. This pattern is also observed in the other countries in the series, but the inclusion of all six countries 11. The original wording of the school and health in the line chart of Figure 12 makes it very difficult to questions referred to ‘‘improper payments’’ rather than read.

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