Political and Bureaucratic Corruption: Interrelation and the role of social factors

Corruption is a worldwide problem that hardly one can overstate about its negative consequences. Two kinds of corruption can be considered¡ one is proposing bribe to bend the rules (bureaucratic corruption) and the other is to lobby with the government (political corruption) to set favorable new rules. Through analyzing the two types of corruption in 57 countries¡ the results show that political and bureaucratic corruptions are complement. However¡ this complementary relation is not symmetric; bureaucratic corruptions has a greater effect. It was shown that economic development reduces the bureaucratic corruptions and substitutes it by political corruption. Among governance and political factors¡ efficiency of judiciary system brings bureaucratic corruptions down and other variables like difficulty of access to government¡ uncertainty of regulation and the proportion of health expenditure in public budget as indicators of government behavior in policy making have negative effects on political corruption. One prominent contribution of this paper is its focus on social factors like bribery disapproval and culture of collusion. The results point to the great role of social factors such that a 10 percent increase in bribe disapproval decreases the corruption score by 20 (it could¡ for example¡ improve Iran’s position by 75 in Corruption Perception Index ranking). The effect of business cooperation is also significant. A five percent increase in membership of business cooperation leads to one percent higher influence on government.