Rethinking the Causes of Corruption: Perceived Corruption, Measurement Bias, and Cultural Illusion

Abstract

This paper extends the empirical research on determinants of corruption conducted during the last 20 years. It argues that the apparent correlations between cultural traditions and a country’s corruption level are not valid causal inferences. Instead, these correlations are primarily the artifacts of measurement bias on the dependent variable. Corruption measured by perception-based indicators can be conflated with the cultural bias conceived by the respondents whose subjective assessments are the main sources of these indicators. These assessments tend to attribute clean government to specific cultural traditions, for example, Protestantism and a long history of being a democracy. These claims are defended with a series of tests that show first the perception-based indicators of corruption suffer substantial weaknesses, especially systematic measurement bias; second, how the causal mechanisms linking corruption to cultural traditions exhibit inherent theoretical uncertainties; and third, that most of the statistical relationships between cultural traditions and corruption disappear when perception-based indicators of corruption are substituted with an experience-based measurement of corruption. In short, the proposed causal relationships between cultural traditions and corruption are spurious.