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Monday, July 12, 2010

The Next Best Alternative to Stamping Out Corruption: Make It Calculable


Some very good sentences from Booty Capitalism: The Politics of Banking in the Philippines,
What is striking about many patrimonial states, Weber reminds us, is not the prevalence of corruption per se, but the great variability of corruption. Bribery and corruption have "the least serious effect" when they are calculable, and become the most onerous when fees are "highly variable" and "settled from case to case with every individual official."
This reminded me of a recent conversation with a friend and current government official, who suggested that some civil servants accepted payments to "push and rush paperwork"

I have an idea then. If we cannot rid the bureaucracy of this kind of behavior, why not legalize it? For a standardized extra fee, let us allow companies to have their papers rushed. The fee should be large enough so that not all companies avail of it but small enough so as to deter bribery. I suspect this would reduce under-the-table agreements. And at least we would know who pays. Because if people are doing it anyway, and we cannot beat them, price discriminate.

The same applies to petty corruption done by motorists and the MMDA. Drivers in Manila know that the best thing to do when caught in a traffic violation is to pay up. I mean, why wouldn't you? The "costs" of not doing so is enormous. One has to go to the office, subject oneself to an incredibly long and variable administrative process, and pay fees. My understanding is that it's not so much that people want to do evil in this way but people would just rather avoid this strenuous process. So, why not have the MMDA accept payments for violations and have them issue official receipts?

Of course, I agree that this does not do anything to get at the roots of the problem. I have yet to think about the unintended consequences of such a solution. But this is a creative solution. And I have yet to hear another plausible solution aside from moral persuasion.

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