The impact of an unexpected wage cut on corruption: Evidence from a “Xeroxed” exam

Oana Borcan, Mikael Lindahl and Andreea Mitrut

Journal of Public Economics, 2014, vol. 120, issue C, 32-47

Abstract: This paper aims to understand how corruption responds to an income loss. We exploit an unexpected 25% wage cut incurred in 2010 by all Romanian public sector employees, including the public education staff. We investigate a corruptible high-stake exam taking place shortly after the wage announcement. To measure corruption we compare changes in exam outcomes from 2007 to 2010 between public and private schools, as the latter were not affected by the policy. We find that the wage loss induced better exam outcomes in public than in private schools and we attribute this difference to increased corruption by public educators.

Keywords: Austerity measures; Bribes; Public school principals; High-stakes exam (search for similar items in EconPapers)
JEL-codes: H4 I2 J3 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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Related works:
Working Paper: The Impact of an Unexpected Wage Cut on Corruption: Evidence from a "Xeroxed" Exam (2012)
Working Paper: The Impact of an Unexpected Wage Cut on Corruption: Evidence from a "Xeroxed" Exam (2012)
Working Paper: The Impact of an Unexpected Wage Cut on Corruption: Evidence from a “Xeroxed” Exam (2012)
Working Paper: The Impact of an Unexpected Wage Cut on Corruption: Evidence from a "Xeroxed" Exam (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:120:y:2014:i:c:p:32-47

DOI: 10.1016/j.jpubeco.2014.08.003

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