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Can transparency of information reduce embezzlement? Experimental Evidence from Tanzania

Author

Listed:
  • Salvatore Di Falco

    (University of Geneva, Bd du Pont-d'Arve 40, CH-1211 Genève 4, Suisse)

  • Brice Magdalou

    (University of Montpellier, LAMETA, avenue Raymond Dugrand - Site Richter C.S. 79606, F-34960 Montpellier Cedex 2, France)

  • David Masclet

    (CREM, CNRS, University of Rennes, 7 place Hoche, 35000 Rennes, France, and CIRANO, Montreal)

  • Marie Claire Villeval

    (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France ; IZA, Bonn; Department of Public Finance, University of Innsbruck)

  • Marc Willinger

    (University of Montpellier, LAMETA, avenue Raymond Dugrand - Site Richter C.S. 79606, F-34960 Montpellier Cedex 2, France)

Abstract

Embezzlement is a major concern. By means of a sequential dictator game, we investigate theoretically and experimentally whether making information more transparent and reducing the number of intermediaries in transfer chains can reduce embezzlement. Consistent with reference-dependent preferences in terms of moral ideal, we show that the impact of transparency is conditional on the length of the transfer chain and on the position of the intermediary in the chain. Its direct effect on image encourages honesty. Its indirect effect via expectations plays in the opposite direction, motivating intermediaries to embezzle more when expecting that the following intermediary will embezzle less.

Suggested Citation

  • Salvatore Di Falco & Brice Magdalou & David Masclet & Marie Claire Villeval & Marc Willinger, 2016. "Can transparency of information reduce embezzlement? Experimental Evidence from Tanzania," Working Papers 1618, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    • Handle: RePEc:gat:wpaper:1618
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    Cited by:

    1. Attanasi, Giuseppe & Rimbaud, Claire & Villeval, Marie Claire, 2019. "Embezzlement and guilt aversion," Journal of Economic Behavior & Organization, Elsevier, vol. 167(C), pages 409-429.
    2. Ye-Feng Chen & Shu-Guang Jiang & Marie Claire Villeval, 2015. "The Tragedy of Corruption. Corruption as a social dilemma," Working Papers 1531, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    3. Giulia Mugellini & Sara Della Bella & Marco Colagrossi & Giang Ly Isenring & Martin Killias, 2021. "Public sector reforms and their impact on the level of corruption: A systematic review," Campbell Systematic Reviews, John Wiley & Sons, vol. 17(2), June.
    4. Chen, Yefeng & Jiang, Shuguang & Villeval, Marie Claire, 2016. "The Tragedy of Corruption," IZA Discussion Papers 10175, Institute of Labor Economics (IZA).
    5. Johannes Abeler & Daniele Nosenzo & Collin Raymond, 2019. "Preferences for Truth‐Telling," Econometrica, Econometric Society, vol. 87(4), pages 1115-1153, July.
    6. Cappelen, Alexander W. & Fjeldstad, Odd-Helge & Mmari, Donald & Sjursen, Ingrid Hoem & Tungodden, Bertil, 2021. "Understanding the resource curse: A large-scale experiment on corruption in Tanzania," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 129-157.
    7. Luca Corazzini & Christopher Cotton & Tommaso Reggiani, 2020. "Delegation and coordination with multiple threshold public goods: experimental evidence," Experimental Economics, Springer;Economic Science Association, vol. 23(4), pages 1030-1068, December.
    8. Garbarino, Ellen & Slonim, Robert & Villeval, Marie Claire, 2019. "Loss aversion and lying behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 158(C), pages 379-393.
    9. Daniel Parra & Manuel Munoz-Herrera & Luis Palacio, 2019. "The limits of transparency as a means of reducing corruption," Working Papers 20190026, New York University Abu Dhabi, Department of Social Science, revised May 2019.
    10. García-Gallego, Aurora & Georgantzis, Nikos & Jaber-López, Tarek & Michailidou, Georgia, 2020. "Audience effects and other-regarding preferences against corruption: Experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 159-173.

    More about this item

    Keywords

    Embezzlement; corruption; dishonesty; transparency; experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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