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How would one define corruption. In economic terms, one definition could that two parties engage in a mutually beneficial transaction to the detriment of an other and society in general, and this despite rules put in place to prevent this. I am not sure everyone will agree with this definition, as it includes everyday situations that one may not generally associate with corruption, such as small gifts we offer to superiors or teachers.
Ulrike Malmendier and Klaus Schmidt study, without calling it corruption, such behavior in an experimental setting. They find that subjects of a gift do reciprocate even if they have no incentive to do so. Worse, they reciprocate more if it is at the expense of a third party, and everybody knows that the third party is affected. Finally, participants correctly assess how their behavior was influenced by gifts, but believe others are much more influenced. It is difficult to square any standard theory with these results. It also implies that such gift-giving is going to be difficult to stamp out, at least when it is relatively small such as in these experiments.
Ulrike Malmendier and Klaus Schmidt study, without calling it corruption, such behavior in an experimental setting. They find that subjects of a gift do reciprocate even if they have no incentive to do so. Worse, they reciprocate more if it is at the expense of a third party, and everybody knows that the third party is affected. Finally, participants correctly assess how their behavior was influenced by gifts, but believe others are much more influenced. It is difficult to square any standard theory with these results. It also implies that such gift-giving is going to be difficult to stamp out, at least when it is relatively small such as in these experiments.
1 comment:
Interestingly, the word "Corrupt" only dates in the sense we use it in today, to around the 18th century. You have to remember that buying venal offices in the military and civil government was common in Britain up into the 19th century. The expectation that rulers ought to act responsibly with money wasn't even on the table or debated until the early modern period. A King taking out a loan to fight a war, and not paying it back, was pretty much par for the course.
Further, trade was largely disdained, especially by aristocrats and their patron philosophers (read: every intellectual in history), presumably because of the institutional competition between two ways of getting money together: inventing things and trading, or setting up a kingdom and stealing everyone's sh!t. Curiously, even though trade was disdained, and even though the word "Corrupt" existed, even back into Middle and Old English derivations like "corrump," nobody used it to describe the ethical situation money brought to interactions.
Corrupt was actually more of a medical and scientific term (before medicine and science existed). So instead of rusting, metal would corrupt. Or the air would corrupt. Crazy huh? All types of sh!t could get tainted or adulterated, but it had nothing to do witih money.
And as far as EL goes above: reciprocal gift giving isn't going anywhere, any time soon, and is a large part of the way what you might call "social exchange" takes place broadly.
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