Corruption Game Research Articles

Measuring corruption in the field using behavioral games

Corruption is often harmful for economic development, yet it is difficult to measure due to its illicit nature. We propose a novel corruption game to characterize the interaction between actual political leaders and citizens, and implement it in Northern Mozambique. Contrary to the game-theoretic prediction, both leaders and citizens engage in corruption. Importantly, corruption in the game is correlated with real-world corruption by leaders: citizens send bribes to leaders whom we observe appropriating community money. In corrupt behavior, we identify an important trust dimension captured by a standard trust game.

Corruption: A cross-country comparison of contagion and conformism

For successful anti-corruption policies, it is crucial to understand the basic social contract governing the interaction between people. Social norms are a key element of the social contract, but may vary across cultures. We investigate how descriptive social norms affect the development of corruption over time. In a laboratory experiment implemented in the Netherlands, Russia, Italy, and China we study a corruption game that is based on a real-effort task. To induce natural variation in descriptive norms, we vary the type of information about others’ choices. Such information may lead to ‘contagion’ -where corruption increases in response to observing high corruption by others- or ‘conformism’ -where it decreases when low corruption by others is observed. Our results show evidence of contagion.

Psychopathy and Economic Behavior Among Prison Inmates: An Experiment.

This paper investigates whether there is a connection between psychopathy and certain manifestations of social and economic behavior, measured in a lab-in-the-field experiment with prison inmates. In order to test this main hypothesis, we let inmates play four games that have often been used to measure prosocial and antisocial behavior in previous experimental economics literature. Specifically, they play a prisoner's dilemma, a trust game, the equality equivalence test that elicits distributional preferences, and a corruption game. Psychopathy is measured by means of the Levenson Self-Report Psychopathy Scale (LSRP) questionnaire, which inmates filled out after having made their decisions in the four games. We find that higher scores in the LSRP are significantly correlated with anti-social behavior in the form of weaker reciprocity, lower cooperation, lower benevolence and more bribe-oriented decisions in the corruption game. In particular, not cooperating and bribe-maximizing decisions are associated with significantly higher LSRP primary and LSRP secondary scores. Not reciprocating is associated with higher LSRP primary and being spiteful with higher LSRP secondary scores.

Inspection—Corruption Game of Illegal Logging and Other Violations: Generalized Evolutionary Approach

Games of inspection and corruption are well developed in the game-theoretic literature. However, there are only a few publications that approach these problems from the evolutionary point of view. In previous papers of this author, a generalization of the replicator dynamics of the evolutionary game theory was suggested for inspection modeling, namely the pressure and resistance framework, where a large pool of small players plays against a distinguished major player and evolves according to certain myopic rules. In this paper, we develop this approach further in a setting of the two-level hierarchy, where a local inspector can be corrupted and is further controlled by the higher authority (thus combining the modeling of inspection and corruption in a unifying setting). Mathematical novelty arising in this investigation involves the analysis of the generalized replicator dynamics (or kinetic equation) with switching, which occurs on the “efficient frontier of corruption”. We try to avoid parameters that are difficult to observe or measure, leading to some clear practical consequences. We prove a result that can be called the “principle of quadratic fines”: We show that if the fine for violations (both for criminal businesses and corrupted inspectors) is proportional to the level of violations, the stable rest points of the dynamics support the maximal possible level of both corruption and violation. The situation changes if a convex fine is introduced. In particular, starting from the quadratic growth of the fine function, one can effectively control the level of violations. Concrete settings that we have in mind are illegal logging, the sales of products with substandard quality, and tax evasion.

Analysis and Modeling of Corruption among Entrepreneurs

Bribery may eradicate social welfare. In the current research, we inspected the mechanism of bribery behaviour based on the (NASH Theory or Non-Cooperative static game theory) which stated by John Forbes Nash Jr. in 1978. With the general hypothesis of “Rational Player,” two bimatrix game models are settled to evaluate the briber and the bribee strategy choice. After discussing the cost-benefit of the (Participants or players), some useful conclusions and dissolve analysis are drawn out. The current study provides three novel experiments that put both metaphors to the test. Overall, a little quantitative study has investigated sequential unethical behaviour. Insomuch prior studies focus on third-party observers’ acceptance of continuous vs. abrupt immoral acts, or the role of self-control and ethical disengagement in the slippery slope of lesser cheating acts empirical investigation contrasting ongoing to the abrupt occurrence of corruption is missing altogether. Recent advances in empirical corruption studies methodology allow the first examination of these different procedures while preserving the economic costs and benefits constant. In the current study, we used a recently improved corruption game by [Köbis, van Prooijen, Righetti, Van Lange, 2015].

The Game of Systemic Corruption in Brazil and the Focal Point Theory

Systemic corruption works differently than petty corruption. The “Car Wash Operation” (Operacao Lava Jato), considered one of the largest corruption scandals in the world, is analyzed through the lens of Game Theory and Schelling's Focal Point to understand the complex phenomenon of systemic corruption. Prosecution agreements generated asymmetry in the bribe-taker and bribe-giver relationship and harmed the most precious asset of a criminal relationship: trust. Destabilizing the harmony between bribe-giver and bribe-taker is key to tackle systemic corruption. In the Corruption Game played in Brazil, a new focal point allowed the players to see that there was a different equilibrium available.

The Corruption Game: Health Systems, International Agencies, and the State in South Asia.

Drawing on ethnographic material collected in Pakistan, India, and Nepal, this article analyzes patterns of corruption in vaccination programs in South Asia. Corrupt practices-which required substantial work-were deeply shaped by both the money and systems of accountability of the global health system. Bilateral and multilateral donors provided substantial funding for immunization programs across South Asia. International agencies and governments instituted systems of accountability, including documentation requirements and a parallel UN bureaucracy in problematic districts, to try to ensure that health workers did what they wanted. Some immunization program staff skillfully bent these systems of accountability to their own ends, diverting vaccination funding into their own pockets. Corruption operates not in opposition to the official rules, but in spaces opened up by them. These practices sometimes transform Weber's rational bureaucracy into a sophisticated game with many players, whose aims are more complex than the stated goals of the bureaucracy.

Social norms of corruption in the field: social nudges on posters can help to reduce bribery

AbstractCorruption in the form of bribery continues to be a major societal challenge around the world. The current lab-in-the-field study tested whether dynamic descriptive norms messages on posters can help to reduce bribery. Before, during and after placing posters throughout a medium-sized South African town, incentivized measures of social norms and bribery were assessed in a mobile lab. A total of 311 participants stemming from the general population took part. In line with the pre-registered predictions, the results reveal that people: (1) perceive bribery to be less common; and (b) engage in bribery in a corruption game less frequently when the posters were displayed. The discussion outlines how social norms nudging campaigns can be leveraged to spur collective action against corruption.

Does power corrupt? The moderating effect of status.

Findings on the effect of power on corruption are mixed. To make sense of these mixed results, three studies were conducted to examine the moderating role of status on this effect. In Study 1, corrupt intent was measured using a corruption scenario that contained manipulations of power and status. In Study 2, corrupt behaviour was measured in a corruption game that contained manipulations of power and status. Study 3 was conducted in real organisational settings, and aimed to expand the external validity of Studies 1 and 2. The results of all three studies consistently indicated that the effect of power was moderated by status. Specifically, power increased corruption when status was low, whereas this effect disappeared when status was high. The implications of reducing the facilitating effect of power on corruption by considering status from the perspective of social hierarchy are discussed.

Evolutionary Inspection and Corruption Games

We extend a standard two-person, non-cooperative, non-zero sum, imperfect inspection game, considering a large population of interacting inspectees and a single inspector. Each inspectee adopts one strategy, within a finite/infinite bounded set of strategies returning increasingly illegal profits, including compliance. The inspectees may periodically update their strategies after randomly inter-comparing the obtained payoffs, setting their collective behaviour subject to evolutionary pressure. The inspector decides, at each update period, the optimum fraction of his/her renewable budget to invest on his/her interference with the inspectees’ collective effect. To deter the inspectees from violating, he/she assigns a fine to each illegal strategy. We formulate the game mathematically, study its dynamics and predict its evolution subject to two key controls, the inspection budget and the punishment fine. Introducing a simple linguistic twist, we also capture the corresponding version of a corruption game.

Does corruption affect cooperation? A laboratory experiment

In this paper, we analyze the nature of cooperation in different corruption regimes. In a laboratory experiment with university students in Mexico, individuals play first a corruption game and then a public goods game. The corruption game is divided into three groups: high- and low-monitoring scenarios as well as a control group not exposed to the game. The public goods game is divided into three groups: the standard game, a game with centralized punishment executed by an exogenously assigned leader, and a game similar to the second one, but adding the possibility of counter-punishment. There are four key results. First, there is more corruption in the low-monitoring group. Second, in the public goods game there is less cooperation in the low-monitoring group than in the group with more intensive monitoring. Third, the option of punishment increases cooperation, but the sensitivity to punishment is greater in the high-monitoring (low-corruption) group. Fourth, the option of counter-punishment of the leader decreases cooperation. Our results highlight the importance of corruption in decreasing trust and social capital and show the difficulty of promoting cooperation when corruption is prevalent.

The Role of Framing, Inequity and History in a Corruption Game: Some Experimental Evidence

We investigate the role of framing, inequity in initial endowments and history in shaping behavior in a corrupt transaction by extending the one-shot bribery game introduced by Cameron et al. (2009) to a repeated game setting. We find that the use of loaded language significantly reduces the incidence of bribery and increases the level of punishment. Punishment of bribery leads to reduced bribery in future. The evidence suggests that this game captures essential features of a corrupt transaction, over and above any sentiments of inequity aversion or negative reciprocity However, showing subjects the history of past play has little effect on the level of corruption.

Kinship, Fractionalization and Corruption

Norms of nepotism and favoritism create corruption, subverting and disrupting impartial institutions and hampering economic development. However, the presence and strength of such norms varies widely within and between countries, and the literature has suggested that this variation is driven, in part, by ethnic fractionalization, with mixed results. We provide evidence for an overlooked -- but deep-rooted -- source of variation in corruption: sub-ethnic fractionalization, driven by mating patterns. The theory of kin selection provides a straightforward justification for norms of nepotism and favoritism among relatives; more subtly, it also implies that the returns to such norms may be influenced by mating practices. Specifically, in societies with high levels of sub-ethnic fractionalization, where endogamous (and consanguineous) mating within kin-group, clan and tribe increases the local relatedness of individuals, the relative returns to norms of nepotism and favoritism are high. In societies with exogamous marriage practices, the relative returns to norms of impartial cooperation with non-relatives and strangers are increased. Using cross-country and within-country regression analyses and a cross-country lab experiment, we provide evidence for this account. Our cross-country analyses show that corruption levels are robustly associated with consanguineous marriage rates, even when controlling for previously studied deep determinants of comparative development. Our within-country analysis exploits variation in consanguinity across Italian provinces and identifies the same pattern. Lab experiments in two countries with different mating patterns provide evidence for our proposed mechanism from subjects who interacted with kin, co-ethnics and strangers in a stylized corruption game.

"Who Doesn't?"--The Impact of Descriptive Norms on Corruption.

Corruption poses one of the major societal challenges of our time. Considerable advances have been made in understanding corruption on a macro level, yet the psychological antecedents of corrupt behavior remain largely unknown. In order to explain why some people engage in corruption while others do not, we explored the impact of descriptive social norms on corrupt behavior by using a novel behavioral measure of corruption. We conducted three studies to test whether perceived descriptive norms of corruption (i.e. the belief about the prevalence of corruption in a specific context) influence corrupt behavior. The results indicated that descriptive norms highly correlate with corrupt behavior—both when measured before (Study 1) or after (Study 2) the behavioral measure of corruption. Finally, we adopted an experimental design to investigate the causal effect of descriptive norms on corruption (Study 3). Corrupt behavior in the corruption game significantly drops when participants receive short anti-corruption descriptive norm primes prior to the game. These findings indicate that perceived descriptive norms can impact corrupt behavior and, possibly, could offer an explanation for inter-personal and inter-cultural variation in corrupt behavior in the real world. We discuss implications of these findings and draw avenues for future research.

Conveniently Upset: Avoiding Altruism by Distorting Beliefs about Others' Altruism

We present results from a “corruption game” (a dictator game modified so that recipients can take a side payment in exchange for accepting a reduction in the overall size of the pie). Dictators (silently) treated to be able to take more of the recipient's tokens, took more of them. They were also more likely to believe that recipients had accepted side payments, even if there was a prize for accuracy. The results favor the hypothesis that people avoid altruistic actions by distorting beliefs about others' altruism. (JEL C72, D63, D64, D83)

On the interpretation of bribery in a laboratory corruption game: moral frames and social norms

Past studies on laboratory corruption games have not been able to find consistent evidence that subjects make “immoral” decisions. A possible reason, and also a critique of laboratory corruption games, is that the experiment may fail to trigger the intended immorality frame in the minds of the participants, leading many to question the very raison d’etre of laboratory corruption games. To test this idea, we compare behavior in a harassment bribery game with a strategically identical but neutrally framed ultimatum game. The results show that fewer people, both as briber and bribee, engage in corruption in the bribery frame than in the alternative and the average bribe amount is lesser in the former than in the latter. These suggest that moral costs are indeed at work. A third treatment, which relabels the bribery game in neutral language, indicates that the observed treatment effect arises not from the neutral language of the ultimatum game but from a change in the sense of entitlement between the bribery and ultimatum game frames. To provide further support that the bribery game does measure moral costs, we elicit the shared perceptions of appropriateness of the actions or social norm, under the two frames. We show that the social norm governing the bribery game frame and ultimatum game frame are indeed different and that the perceived sense of social appropriateness plays a crucial role in determining the actual behavior in the two frames. Furthermore, merely relabelling the bribery game in neutral language makes no difference to the social appropriateness norm governing it. This indicates that, just as in the case of actual behavior, the observed difference in social appropriateness norm between bribery game and ultimatum game comes from the difference in entitlement too. Finally, we comment on the external validity of behavior in lab corruption games.

Does Reporting Decrease Corruption?

We construct two variants of a three-player one-shot corruption game, one in which reporting on bribers is cumbersome and one in which it is rewarded (profitable). Both variants feature a briber who can bribe or not, an official who can reciprocate or not and an inspector who can inspect or not. In the first variant, the official accepts the bribe by reciprocating or simply rejects the bribe by choosing not to reciprocate. In the second variant, the official either accepts and reciprocates or rejects and reports the bribe. Under successful inspection, offending players receive separate penalties, which can be varied asymmetrically. Under plausible assumptions about the values of payoff parameters, we obtain a mixed-strategy Nash equilibrium in both variants, akin to Tsebelis’ inspection game. We obtain two interesting results. First, marginally changing the penalties moves the equilibrium probabilities in both games in the same directions, suggesting robustness of the model. We find that larger penalties on the briber increase the overall probability of reciprocated bribery, that is, corruption, while larger penalties on the official decrease corruption. Second, when comparing the two models, we obtain the surprising result that the probability of reciprocated bribery (corruption) is higher in the variant where the official is rewarded for reporting on the briber. JEL: K42, H00, C72, O17

Endogenous Detection of Collaborative Crime: The Case of Corruption

We construct a one-shot corruption game with three players, a briber who can decide to bribe or not, an official who can reciprocate or not and an inspector who can decide to inspect or not. We employ four penalties that can be distributed asymmetrically, making it possible to punish bribing and bribe-taking as well as reciprocating and receiving reciprocation to different degrees. Penalties apply if corruption is detected. The probability of detection is endogenised, as it depends on inspection. The model differs from other inspection games in that the offence (corruption) can only be completed through a joint effort of the two offending players. This leads to surprising results, especially in conjunction with asymmetric penalties. First, in contrast to Tsebelis’ results, we find that, with endogenous detection, higher penalties do reduce the overall rate of offence. Second, this result holds only if the penalty for reciprocating on the official is raised. Surprisingly, and unlike other asymmetric penalty prescriptions in the corruption literature, higher penalties on the briber have the opposite effect. They may reduce the probability of bribery, but they also increase the probability of reciprocation to the extent that the overall probability of reciprocated bribery is increased.

Risk attitude, beliefs, and information in a Corruption Game – An experimental analysis

For our experiment on corruption, we designed a coordination game to model the influence of risk attitudes, beliefs, and information on behavioral choices and determined the equilibria. We observed that the risk attitude of the participant failed to explain their choices between corrupt and non-corrupt behavior. Instead, their beliefs appeared to be a better predictor of whether or not they would opt for the corrupt alternative. Furthermore, varying the quantity of information available to the players (modeled by changing the degree of uncertainty) provided additional insight into the players’ propensity to engage in corrupt behavior. The experimental results show that a higher degree of uncertainty in the informational setting reduces corruption.

The Corruption Game: Simulated Experiential Learning of Ethical/Emotional Trade-Offs

This paper outlines requirements and specifications for a gaming simulation model using virtual worlds, where subjects interact in avatar roles of various government officials and clients, to study the social network dynamics of the spread of corruption, as well as possible interventions to reduce corruption. The application focus is on corruption in seaports, relating to the bribing of customs officials to avoid import/export taxes or to enable the import of illegal goods, such as drugs.