Costing and curing corruption in public transit agencies

Cameron Gordon

Journal of Financial Crime, 2006, vol. 13, issue 4, 442-455

Abstract: Purpose - What is the cost of corruption and associated financial malfeasance in public transit? The purpose of this paper is to consider this question, focusing on two American agencies: the Metropolitan Transit Authorities (MTA) in both New York and Los Angeles. Design/methodology/approach - This paper reviews the literature on corruption, mismanagement and malfeasance in the public sector generally and the factors which are believed to lead to these phenomena; and preliminarily assesses the relative presence and cost of such malpractices in their MTAs, and their causative factors in public transit agencies generally. Findings - Preliminary analysis of reports of corruption and malfeasance in the two MTAs yields cost estimates of over $US200 million in the Los Angeles County Metropolitan Transportation Authority and over $US1 billion in the New York State Metropolitan Transportation Authority across roughly five‐year periods (periods of analysis not being exactly the same for the two agencies). Research limitations/implications - The data examined were not comprehensive and costings not final. Thus, the estimates can be considered to be lower than the actual incidence and costs. Originality/value - By preliminarily quantifying the cost of maladministration in the largest transit agency in the USA and then one of the newest, this paper provides an assessment important in and of itself and also provides an initial methodology which can be used for more precise costing and analysis of such issues in the future. Possible causes of such problems include lack of accountability: the two MTAs are independent authorities with little legislative or executive oversight; and also the fact of these being public monopolies.

Keywords: Corruption; Public administration; Transportation; United States of America (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfcpps:13590790610707564

DOI: 10.1108/13590790610707564

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