{"id":99,"date":"2025-05-30T14:21:51","date_gmt":"2025-05-30T18:21:51","guid":{"rendered":"https:\/\/people.bsu.edu\/econbriefs\/?p=99"},"modified":"2025-05-30T14:21:51","modified_gmt":"2025-05-30T18:21:51","slug":"corruption-oversight-and-honesty-by-dr-cecil-bohanon-and-dr-john-horowitz","status":"publish","type":"post","link":"https:\/\/people.bsu.edu\/econbriefs\/2025\/05\/30\/corruption-oversight-and-honesty-by-dr-cecil-bohanon-and-dr-john-horowitz\/","title":{"rendered":"Corruption, Oversight, and Honesty \u2013 by Dr. Cecil Bohanon and Dr. John Horowitz"},"content":{"rendered":"

Though there is limited empirical research on corruption, economists tend to analyze corruption from an individual cost-benefit perspective. The costs are the risk of the externally imposed legal punishment times the level of the punishment, along with the potential social shame and personal guilt suffered by the corrupt party. The benefits can be monetary or non-monetary.<\/span>\u00a0<\/span><\/p>\n

The costs of being corrupt are higher when a person is more likely to be caught, and the penalties for corruption are more severe. The likelihood of being caught increases with more oversight, monitoring, and effective anti-corruption efforts. Interestingly, a recent study on corruption in American states suggests more <\/span>isolated capital cities, such as Harrisburg, PA, have more corruption<\/span><\/a>. Media monitoring and reporting quality is also important, <\/span>as is media bias<\/span><\/a>. Larger penalties for corruption include longer prison sentences, more social disapproval, and higher monetary penalties. Other research shows that <\/span>officials benefit more from corruption when they have more discretionary power, such as when rules are more complex and less transparent<\/span><\/a>.\u00a0<\/span>\u00a0<\/span><\/p>\n

What is considered corruption depends on the local culture and legal regime. In many countries, offering a nice lunch to restaurant inspectors is expected. In others, offering a gift to a judge during an adoption hearing is considered good manners. Almost everywhere, blatant bribes are considered corrupt, but donations to elected officials\u2019 campaigns or government officials\u2019 favorite charities are often considered borderline.\u00a0<\/span>\u00a0<\/span><\/p>\n

In education, corruption may be manifest in falsely inflated student test scores. In a recent study from <\/span>Romania, increased monitoring of students\u2019 test-taking led to less cheating and lower test scores. Interestingly, the test scores of low-income students went dow<\/span><\/a>n the most. In the Romanian case, there had been a culture of cheating in education. The public\u2019s realization of how poorly schools were actually performing led to a public outcry that generated the political will to rectify the situation.\u00a0<\/span>\u00a0<\/span><\/p>\n

Some economists think bribery, fraud, and illegally diverting government funds are not the most critical issues<\/span><\/a> in economic development<\/span>. However, aid agencies often focus on ending bribery and theft because they fear donors will stop funding them when corruption is revealed. However, a common \u201cremedy,\u201d sending aid through the central government, may worsen the problem. Centralizing control makes a few agencies more powerful and often leads to more corruption. Most economists agree that corruption is a problem as it subverts governing institutions. Reducing corruption is desirable but often difficult to accomplish.\u00a0\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Though there is limited empirical research on corruption, economists tend to analyze corruption from an individual cost-benefit perspective. The costs are the risk of the externally imposed legal punishment times the level of the punishment, along with the potential social shame and personal guilt suffered by the corrupt party. The benefits can be monetary or […]<\/p>\n","protected":false},"author":112,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[146],"tags":[992,999,1000,1002,412,990,1001,147,524,410,998,279,994,996,346,993,991,57,995,684,997,283],"class_list":["post-99","post","type-post","status-publish","format-standard","hentry","category-culture","tag-anti-corruption","tag-bribe","tag-charity","tag-cheating","tag-corruption","tag-cost-benefit","tag-donation","tag-economics","tag-economist","tag-education","tag-gift","tag-grade-inflation","tag-harrisburg","tag-media-bias","tag-monetary","tag-monitoring","tag-non-monetary","tag-prison","tag-reporting","tag-risk","tag-social-disapproval","tag-test-scores"],"yoast_head":"\nCorruption, Oversight, and Honesty \u2013 by Dr. Cecil Bohanon and Dr. John Horowitz - Econ Briefs<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/people.bsu.edu\/econbriefs\/2025\/05\/30\/corruption-oversight-and-honesty-by-dr-cecil-bohanon-and-dr-john-horowitz\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Corruption, Oversight, and Honesty \u2013 by Dr. Cecil Bohanon and Dr. John Horowitz - Econ Briefs\" \/>\n<meta property=\"og:description\" content=\"Though there is limited empirical research on corruption, economists tend to analyze corruption from an individual cost-benefit perspective. 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