Corruption and cheating: Evidence from rural Thailand

Abstract

• This study tests the prediction that perceived corruption reduces ethical behavior in a broad household survey in rural Thailand. • Respondents who perceive corruption in state affairs are more likely to cheat. • Thus, the induced cheating fortifies the negative consequences of corruption. • The reputational concern to be seen as honest, approximated by attendance of others, reduces cheating. • Consequently, transparency, here indicated by attendance of others, provides one remedy. This study tests the prediction that perceived corruption reduces ethical behavior. Integrating a standard “cheating” experiment into a broad household survey in rural Thailand, we find tentative support for this prediction: respondents who perceive corruption in state affairs are more likely to cheat and, thus, to fortify the negative consequences of corruption. Interestingly, there is a small group of non-conformers. The main relation is robust to consideration of socio-demographic, attitudinal, and situational control variables. Attendance of others at the cheating experiment, stimulating the reputational concern to be seen as honest, reduces cheating, thus indicating transparency as a remedy.