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Enforcement and Public Corruption: Evidence from the American States

Author

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  • James E. Alt
  • David Dreyer Lassen

Abstract

We use panel data on corruption convictions, new panels of assistant US Attorneys and relative public sector wages, and careful attention to the consequences of modeling endogeneity to estimate the impact of prosecutorial resources on criminal convictions of those who undertake corrupt acts. Consistent with "system capacity" arguments, we find that greater prosecutor resources result in more convictions for corruption, other things equal. By explicitly determining the allocation of prosecutorial resources endogenously from partisan and administrative considerations, we show that this specification leads to larger estimates of the effect of resources on convictions. We also control for and confirm in a panel context the effects of many previously identified correlates and causes of corruption. We find more limited, recent evidence for the deterrent effect of increased prosecutions. The results are robust to various ways of measuring the number of convictions as well as to various estimators. (JEL D72, D73, H83, K42)

Suggested Citation

  • James E. Alt & David Dreyer Lassen, 2014. "Enforcement and Public Corruption: Evidence from the American States," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 30(2), pages 306-338.
    • Handle: RePEc:oup:jleorg:v:30:y:2014:i:2:p:306-338.
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    File URL: http://hdl.handle.net/10.1093/jleo/ews036
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    Cited by:

    1. Dincer, Oguzhan & Gillanders, Robert, 2021. "Shelter in place? Depends on the place: Corruption and social distancing in American states," Social Science & Medicine, Elsevier, vol. 269(C).
    2. Murphy, Ryan H., 2020. "The Quality of Legal Systems and Property Rights by State: A Ranking and Their Implications for Economic Freedom," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 50(1), April.
    3. Sanchari Choudhury, 2021. "Regulation and Corruption: Evidence from the United States," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(4), pages 897-934, August.
    4. Chen, Yanting & Liu, Qijun, 2018. "Public-sector wages and corruption: An empirical study," European Journal of Political Economy, Elsevier, vol. 54(C), pages 189-197.
    5. Yating Pan & Zhan Shu & Zhipeng Ye, 2023. "Exploring the dynamics of corruption perceptions in sustained anti-corruption campaigns: a survey experiment in China," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-9, December.
    6. Dincer, Oguzhan, 2019. "Does corruption slow down innovation? Evidence from a cointegrated panel of U.S. states," European Journal of Political Economy, Elsevier, vol. 56(C), pages 1-10.
    7. Jamie Bologna Pavlik, 2017. "Political importance and its relation to the federal prosecution of public corruption," Constitutional Political Economy, Springer, vol. 28(4), pages 346-372, December.
    8. Salvatore Capasso & Rajeev K. Goel & James W. Saunoris, 2019. "Is it the gums, teeth or the bite? Effectiveness of dimensions of enforcement in curbing corruption," Economics of Governance, Springer, vol. 20(4), pages 329-369, December.
    9. Galinato, Gregmar I. & Rohla, Ryne, 2020. "Do privately-owned prisons increase incarceration rates?," Labour Economics, Elsevier, vol. 67(C).
    10. Ben Ali Tarek & Zidi Ahmed, 2017. "Institutional Quality and Public Debt Accumulation: An Empirical Analysis," International Economic Journal, Taylor & Francis Journals, vol. 31(3), pages 415-435, July.
    11. Yang, Li & Milanović, Branko & Lin, Yaoqi, 2023. "Anti-corruption campaign in China: An empirical investigation," ZEW Discussion Papers 23-052, ZEW - Leibniz Centre for European Economic Research.
    12. Lewis Davis & K. R. White, 2021. "Is justice blind? Evidence from federal corruption convictions," Public Choice, Springer, vol. 186(1), pages 63-95, January.
    13. Demirgüç-Kunt, Asli & Lokshin, Michael & Kolchin, Vladimir, 2023. "Effects of public sector wages on corruption: Wage inequality matters," Journal of Comparative Economics, Elsevier, vol. 51(3), pages 941-959.
    14. Gans-Morse, Jordan & Borges, Mariana & Makarin, Alexey & Mannah-Blankson, Theresa & Nickow, Andre & Zhang, Dong, 2018. "Reducing bureaucratic corruption: Interdisciplinary perspectives on what works," World Development, Elsevier, vol. 105(C), pages 171-188.
    15. Zakharov, Nikita, 2019. "Does corruption hinder investment? Evidence from Russian regions," European Journal of Political Economy, Elsevier, vol. 56(C), pages 39-61.
    16. 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.
    17. Fernanda Odilla, 2020. "Oversee and Punish: Understanding the Fight Against Corruption Involving Government Workers in Brazil," Politics and Governance, Cogitatio Press, vol. 8(2), pages 140-152.
    18. Lambsdorff Johann Graf & Schulze Günther G., 2015. "Guest Editorial: Special Issue on Corruption at the Grassroots-level: What Can We Know About Corruption?," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(2), pages 100-114, April.
    19. Melki, Mickael & Pickering, Andrew, 2020. "Polarization and corruption in America," European Economic Review, Elsevier, vol. 124(C).
    20. Bermpei, Theodora & Kalyvas, Antonios & Nguyen, Thanh Cong, 2018. "Does institutional quality condition the effect of bank regulations and supervision on bank stability? Evidence from emerging and developing economies," International Review of Financial Analysis, Elsevier, vol. 59(C), pages 255-275.
    21. Jeffrey Milyo & Adriana Cordis, 2013. "Measuring Public Corruption in the United States: Evidence from Administrative Records of Federal Prosecutions," Working Papers 1322, Department of Economics, University of Missouri.
    22. Dincer, Oguzhan & Gunalp, Burak, 2020. "The effects of federal regulations on corruption in U.S. States," European Journal of Political Economy, Elsevier, vol. 65(C).
    23. Aidt, Toke S. & Hillman, Arye L. & Qijun, LIU, 2020. "Who takes bribes and how much? Evidence from the China Corruption Conviction Databank," World Development, Elsevier, vol. 133(C).
    24. Tomic, Slobodan & Rauh, William Jonathan, 2023. "How Political Culture Shapes Horizontal Accountability Outcomes: Evidence from 62 Countries," SocArXiv uf3nw, Center for Open Science.

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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