IDEAS home Printed from https://ideas.repec.org/a/nea/journl/y2021i49p115-136.html
   My bibliography  Save this article

Is the difference in consumption and income an indication of petty corruption?

Author

Listed:
  • Zhuravleva, T.

    (National Research University "Higher Scool of Economics" (NRU HSE), Saint Petersburg, Russia)

Abstract

Based on micro-level data on reported household earnings, expenditures and assets, provided by the Russian Longitudinal Monitoring Survey (RLMS) for the period 2000-2013, it is found that households with workers in the public sector receive lower earnings than households with members employed in the private sector but enjoy the same level of consumption. Controlling for the reported level of earnings, private households do not show a significantly higher probability of possessing summer cottages (dachas), cars and computers, or living in better housing conditions, or having a higher level of monetary savings. The differences in assets cannot be reconciled with the sizeable expenditure-income gap found. The precautionary motives of workers are not able to reconcile these discrepancies either: neither attitude to risk, nor risk itself, differ between individuals employed in the private and public sectors. It is hypothesized that employees continue working in the public sector despite their low rate of official pay, because of unreported income they receive, or bribes.

Suggested Citation

  • Zhuravleva, T., 2021. "Is the difference in consumption and income an indication of petty corruption?," Journal of the New Economic Association, New Economic Association, vol. 49(1), pages 115-136.
    • Handle: RePEc:nea:journl:y:2021:i:49:p:115-136
    DOI: 10.31737/2221-2264-2021-49-1-4
    as

    Download full text from publisher

    File URL: http://www.econorus.org/repec/journl/2021-49-115-136r.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.31737/2221-2264-2021-49-1-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Gundlach, Erich & Paldam, Martin, 2009. "The transition of corruption: From poverty to honesty," Economics Letters, Elsevier, vol. 103(3), pages 146-148, June.
    2. Mr. Sanjeev Gupta, 1998. "Does Corruption Affect Income Inequality and Poverty?," IMF Working Papers 1998/076, International Monetary Fund.
    3. Kwabena Gyimah-Brempong, 2002. "Corruption, economic growth, and income inequality in Africa," Economics of Governance, Springer, vol. 3(3), pages 183-209, November.
    4. Irina Slinko & Ekaterina Zhuravskaya & Evgeny Yakovlev, 2005. "Laws for Sale: Evidence from Russia," American Law and Economics Review, American Law and Economics Association, vol. 7(1), pages 284-318.
    5. Benjamin A. Olken & Patrick Barron, 2009. "The Simple Economics of Extortion: Evidence from Trucking in Aceh," Journal of Political Economy, University of Chicago Press, vol. 117(3), pages 417-452, June.
    6. Brainerd, Elizabeth, 2002. "Five Years after: The Impact of Mass Privatization on Wages in Russia, 1993-1998," Journal of Comparative Economics, Elsevier, vol. 30(1), pages 160-190, March.
    7. Журавлева Татьяна Леонидовна & Сухов Станислав Вячеславович, 2016. "Лабораторные Эксперименты Как Метод Изучения Коррупции: Обзор Исследований," Higher School of Economics Economic Journal Экономический журнал Высшей школы экономики, CyberLeninka;Федеральное государственное автономное образовательное учреждение высшего образования «Национальный исследовательский университет «Высшая школа экономики», vol. 20(2), pages 243-267.
    8. Gorodnichenko, Yuriy & Sabirianova Peter, Klara, 2007. "Public sector pay and corruption: Measuring bribery from micro data," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 963-991, June.
    9. Sequeira, Sandra & Djankov, Simeon, 2010. "An Empirical Study of Corruption in Ports," MPRA Paper 21791, University Library of Munich, Germany.
    10. Klaus Abbink & Bernd Irlenbusch & Elke Renner, 2002. "An Experimental Bribery Game," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 18(2), pages 428-454, October.
    11. Evgeny Yakovlev & Ekaterina Zhuravskaya, 2009. "State Capture: From Yeltsin to Putin," International Economic Association Series, in: János Kornai & László Mátyás & Gérard Roland (ed.), Corruption, Development and Institutional Design, chapter 2, pages 24-36, Palgrave Macmillan.
    12. Mr. Paolo Mauro, 1996. "The Effects of Corruption on Growth, Investment, and Government Expenditure," IMF Working Papers 1996/098, International Monetary Fund.
    13. Ritva Reinikka & Jakob Svensson, 2004. "Local Capture: Evidence from a Central Government Transfer Program in Uganda," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 679-705.
    14. Shang-Jin Wei, 2000. "How Taxing is Corruption on International Investors?," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 1-11, February.
    15. Adamchik, Vera A. & Bedi, Arjun S., 2000. "Wage differentials between the public and the private sectors: evidence from an economy in transition," Labour Economics, Elsevier, vol. 7(2), pages 203-224, March.
    16. Safavian, Mehnaz S. & Sheldon, Ian M. & Graham, Douglas H. & Gonzalez-Vega, Claudio, 2001. "The Differential Impact Of Corruption On Microenterprises In Russia," 2001 Annual meeting, August 5-8, Chicago, IL 20495, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    17. Safavian, Mehnaz S. & Graham, Douglas H. & Gonzalez-Vega, Claudio, 2001. "Corruption and Microenterprises in Russia," World Development, Elsevier, vol. 29(7), pages 1215-1224, July.
    18. Miriam A. Golden & Lucio Picci, 2005. "Proposal For A New Measure Of Corruption, Illustrated With Italian Data," Economics and Politics, Wiley Blackwell, vol. 17(1), pages 37-75, March.
    19. Guerra, Alice & Zhuravleva, Tatyana, 2021. "Do bystanders react to bribery?," Journal of Economic Behavior & Organization, Elsevier, vol. 185(C), pages 442-462.
    20. Benjamin A. Olken, 2007. "Monitoring Corruption: Evidence from a Field Experiment in Indonesia," Journal of Political Economy, University of Chicago Press, vol. 115(2), pages 200-249.
    21. Gregory, Robert G. & Borland, Jeff, 1999. "Recent developments in public sector labor markets," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 53, pages 3573-3630, Elsevier.
    22. Olga Popova, 2010. "Corruption, Voting and Employment Status: Evidence from Russian Parliamentary Elections," CERGE-EI Working Papers wp428, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    23. repec:eee:labchp:v:3:y:1999:i:pc:p:3573-3630 is not listed on IDEAS
    24. Lui, Francis T, 1985. "An Equilibrium Queuing Model of Bribery," Journal of Political Economy, University of Chicago Press, vol. 93(4), pages 760-781, August.
    25. T. Zhuravleva., 2015. "Does the Russian Government Pay a "Fair" Wage: Review of Studies," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 11.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tatiana Zhuravleva, 2013. "Corruption Measurement: the case of Russian Federation," Working Papers 0068, Gaidar Institute for Economic Policy, revised 2013.
    2. Krisztina Kis-Katos & Günther G. Schulze, 2013. "Corruption in Southeast Asia: a survey of recent research," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 27(1), pages 79-109, May.
    3. Fonseca-Mairena, María Haydée & Triossi, Matteo, 2019. "Incentives and implementation in marriage markets with externalities," Economics Letters, Elsevier, vol. 185(C).
    4. Schram, Arthur & Zheng, Jin Di & Zhuravleva, Tatyana, 2022. "Corruption: A cross-country comparison of contagion and conformism," Journal of Economic Behavior & Organization, Elsevier, vol. 193(C), pages 497-518.
    5. Benjamin A. Olken & Rohini Pande, 2012. "Corruption in Developing Countries," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 479-509, July.
    6. Jean-Benoit Falisse & Nastassia Leszczynska, 2015. "Professional Identity, Bribery and Public Service Delivery: Evidence from a Lab-in-the-Field Experiment in Burundi," Working Papers ECARES ECARES 2015-07, ULB -- Universite Libre de Bruxelles.
    7. Olivier Armantier & Amadou Boly, 2008. "Can Corruption Be Studied in the Lab? Comparing a Field and a Lab Experiment," CIRANO Working Papers 2008s-26, CIRANO.
    8. Hanming Fang, 2024. "Measurements, determinants, causes, and consequences of corruption: lessons from China’s anti-corruption campaign," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 31(1), pages 3-25, February.
    9. Nicolas Campos & Eduardo Engel & Ronald D. Fischer & Alexander Galetovic, 2019. "Renegotiations and corruption in infrastructure: The Odebrecht case," "Marco Fanno" Working Papers 0230, Dipartimento di Scienze Economiche "Marco Fanno".
    10. Lehne, Jonathan & Shapiro, Jacob N. & Vanden Eynde, Oliver, 2018. "Building connections: Political corruption and road construction in India," Journal of Development Economics, Elsevier, vol. 131(C), pages 62-78.
    11. Roberto Burguet & Juan-José Ganuza & José García-Montalvo, 2016. "The Microeconomics of Corruption. A Review of Thirty Years of Research," Working Papers 908, Barcelona School of Economics.
    12. Beekman, Gonne & Bulte, Erwin H. & Nillesen, Eleonora E.M., 2013. "Corruption and economic activity: Micro level evidence from rural Liberia," European Journal of Political Economy, Elsevier, vol. 30(C), pages 70-79.
    13. Gorodnichenko, Yuriy & Sabirianova Peter, Klara, 2007. "Public sector pay and corruption: Measuring bribery from micro data," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 963-991, June.
    14. Harouna Sedgo & Luc Désiré Omgba, 2023. "Corruption and distortion of public expenditures: evidence from Africa," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 30(2), pages 419-452, April.
    15. Yan Leung Cheung & P. Raghavendra Rau & Aris Stouraitis, 2012. "How much do firms pay as bribes and what benefits do they get? Evidence from corruption cases worldwide," NBER Working Papers 17981, National Bureau of Economic Research, Inc.
    16. Arteaga, Fernando & Desierto, Desiree & Koyama, Mark, 2024. "Shipwrecked by rents," Journal of Development Economics, Elsevier, vol. 168(C).
    17. Jiang, Shuguang & Wei, Qian & Zhao, Lei, 2024. "Synergizing anti-corruption strategies: Group monitoring and endogenous crackdown – An experimental investigation," China Economic Review, Elsevier, vol. 85(C).
    18. Hunt, Jennifer & Laszlo, Sonia, 2012. "Is Bribery Really Regressive? Bribery’s Costs, Benefits, and Mechanisms," World Development, Elsevier, vol. 40(2), pages 355-372.
    19. Jamie Bologna, 2017. "Contagious corruption, informal employment, and income: evidence from Brazilian municipalities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 58(1), pages 67-118, January.
    20. Eugen Dimant & Guglielmo Tosato, 2018. "Causes And Effects Of Corruption: What Has Past Decade'S Empirical Research Taught Us? A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 335-356, April.

    More about this item

    Keywords

    petty corruption; bribery; Russian Federation; Russian Longitudinal Monitoring Survey (RLMS);
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J4 - Labor and Demographic Economics - - Particular Labor Markets
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • P2 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nea:journl:y:2021:i:49:p:115-136. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alexey Tcharykov (email available below). General contact details of provider: https://edirc.repec.org/data/nearuea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.