Friend or foe? Social ties in bribery and corruption

Jin Zheng (), Arthur Schram and Gönül Doğan ()
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Jin Zheng: Nanjing Audit University
Gönül Doğan: University of Cologne

Experimental Economics, 2021, vol. 24, issue 3, No 6, 854-882

Abstract: Abstract This paper studies how social ties interact with bribery and corruption. In the laboratory, subjects are in triads where two ‘performers’ individually complete an objective real-effort task and an evaluator designates one of them as the winner of a monetary prize. In one treatment dimension, we vary whether performers can bribe the evaluator—where any bribe made is non-refundable, irrespective of the evaluator’s decision. A second treatment dimension varies the induced social ties between the evaluator and the performers. The experimental evidence suggests that both bribes and social ties may corrupt evaluators’ decisions. Bribes decrease the importance of performance in the decision. The effect of social ties is asymmetric. While performers’ bribes vary only little with their ties to the evaluator, evaluators exhibit favoritism based on social ties when bribes are not possible. This ‘social-tie-based’ corruption is, however, replaced by bribe-based corruption when bribes are possible. We argue that these results have concrete consequences for possible anti-corruption policies.

Keywords: Social ties; In-group favoritism; Bribery; Laboratory experiment (search for similar items in EconPapers)
JEL-codes: C9 D03 D73 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s10683-020-09683-7

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