An updated version of my anticorruption bibliography is available from my faculty webpage. A direct link to the pdf of the full bibliography is here, and a list of the new sources added in this update is here. As always, I welcome suggestions for other sources that are not yet included, including any papers GAB readers have written.
Transparency International (TI) released its latest Corruption Perceptions Index (CPI) last month. A couple weeks back, in what has unfortunately become a necessary annual tradition, I posted a warning that one should not attach significance to short-term changes in any individual country’s CPI score. Today, I want to turn to another matter. In recent years, whenever TI releases a new edition of the CPI, the organization plays up certain themes or claims that, according to TI, the CPI reveals about corruption’s causes or impact. This year, one of the main themes in the report is the connection between corruption and campaign finance regulation. As this year’s lead TI press release on the CPI declares, “Analysis [of the data] shows that countries that perform well on the CPI also have stronger enforcement of campaign finance regulations.… Countries where campaign finance regulations are comprehensive and systematically enforced have an average score of 70 on the [100-point] CPI, whereas countries where such regulations either don’t exist or are so poorly enforced score an average of just 34 or 35 respectively.” (On the CPI, higher scores indicate lower perceived corruption.)
How did TI arrive at this conclusion? The report accompanying the CPI, and the longer research brief on this topic, give a bit more explanation. TI used another index, from the Varieties of Democracy (V-Dem) project, on “Disclosure of Campaign Donations.” The V-Dem index rates countries’ disclosure requirements for campaign donations on a 0-4 ordinal scale. TI took this scale, collapsed the 0 and 1 categories into one (allegedly for “data visualization purposes,” though I’m not sure what this means), and then calculated the CPI score for the countries in each of the four categories. The results:
That looks like pretty strong evidence that strong campaign finance disclosure rules are associated with lower corruption, and that’s certainly the story TI wants to tell. As the report puts it, “Unregulated flows of big money in politics … make public policy vulnerable to undue influence.” The research brief similarly explains, “Shedding light on who donates and how much, can expose the influence of money in politics and deter corruption and other pay-to-play situations.”
The claim may ultimately be correct, but on closer inspection, the evidence TI adduces in support of that claim is deeply problematic. Continue reading
Kevin Davis, the Beller Family Professor of Business Law at New York University School of Law, contributes today’s guest post, based on his recent working paper.
Academics and policymakers enthusiastically endorse “evidence-based” policymaking, for obvious reasons. (After all, what is the alternative? Faith? Popularity contests?) But while evidence—including quantitative evidence—is often helpful, we must be mindful of the limits on what empirical analysis can tell us about important topics. Take the regulation of transnational bribery. Scholars and policymakers would like to know if the current regime—laws like the U.S. Foreign Corrupt Practices Act (FCPA) and U.K. Bribery Act, and international instruments like the OECD Anti-Bribery Convention—has “worked.” That is, have these instruments reduced bribery by the firms that they cover? And did those laws have additional, possibly undesirable collateral consequences, for example reducing investment in countries perceived to be corrupt?
The most sophisticated efforts to answer these questions (see, for example, here and here and here) essentially rely on what social scientists call “natural experiments.” First, the intervention (the law or policy change) of interest, which (in a borrowing from medical terminology) researchers call the “treatment.” Next, one must identify the population of interest—say, firms or countries—and an outcome of interest (such as the frequency of bribery or the level of investment). Then, the researcher identifies the subset of those entities that are affected by the intervention (for example, the firms that fall under the jurisdiction of the new anti-bribery law); this is the “treatment group.” The researcher also identifies another subset of entities—the “control group”—that appears otherwise similar to the treatment group, but did not receive the treatment (for example, a group of firms that are outside the jurisdiction of the new law). The big difference between a “controlled experiment” and a “natural experiment” is that in a controlled experiment the researcher can randomly choose which members of the population receive the treatment (for example by randomly selecting some patients to get a new drug and giving the other patients a placebo), but in a natural experiment, the assignment of the treatment is done not by the researcher, but by some “natural” process in the world. In trying to figure out the effect of an anti-corruption law, it generally is not feasible to conduct a controlled experiment: researchers can’t decide that these firms but not those firms, selected at random, will fall under the jurisdiction of an anti-bribery law. So the best that researchers can do is to rely on natural experiments and try to account as best they can for possible differences between the control group and the treatment group by including additional control variables in a multivariate regression.
Unfortunately, when it comes to studying the effects of transnational anti-bribery laws, these sorts of studies face several fundamental challenges, which are all too often overlooked or understated. Continue reading
A new episode of KickBack: The Global Anticorruption Podcast is now available. In this episode, I interview Gary Kalman, formerly (and at the time of the interview) the Executive Director of the FACT Coalition, and now the Director of the U.S. Office of Transparency International. The first part of our conversation focuses on the work Mr. Kalman did at the FACT Coalition on the push for new U.S. legislation to crack down on anonymous companies. We also discuss his vision, and top priorities, for Transparency International’s new U.S. office.
You can find this episode, along with links to previous podcast episodes, at the following locations:
KickBack is a collaborative effort between GAB and the ICRN. If you like it, please subscribe/follow, and tell all your friends! And if you have suggestions for voices you’d like to hear on the podcast, just send me a message and let me know.
Last month, Transparency International (TI) released the latest version of its Corruption Perceptions Index (CPI)–an index that I continue to believe is useful and important, and that I regularly defend against the blunderbuss critiques sometimes leveled by a few of my colleagues in the academy. Yet every year when the CPI comes out, we see a spate of articles and press releases that focus on individual countries’ score changes from one year to the next. (For some examples from this year, see here, here, here, here, and here.) TI contributes to this: Despite the qualifications and cautions one can find if you search TI’s web site diligently enough, TI’s lead press release and main CPI report inevitably play up these changes, connecting them to whatever larger narrative that TI hopes to convey. This year was no exception. This time around, the press release emphasizes that “(f)our G7 countries score[d] lower than last year: Canada (-4), France (-3), the UK (-3) and the US (-2). Germany and Japan have seen no improvement, while Italy gained one point”–and TI treats this as evidence for the assertion, in the title of the press release, that the “2019 Corruption Perceptions Index shows anti-corruption efforts stagnating in G7 countries.”
Sigh. I feel like I have to do this every year, but I’ll keep doing it until the message sinks in. Repeat after me:
I don’t want to repeat everything I’ve written before explaining why this is so; I explained this at length in my post last year, after the 2018 CPI came out. (That post, in turn, relied on my prior writing on this topic: See here, here, here, here, here, and here.) I’ve kind of given up hope that TI will actually modify the way it talks about within-country year-to-year CPI score changes in its press releases. I know enough people at TI (great people, I should add) who are aware of what I (and plenty of others) have had to say on this topic that I can only assume that the failure to change is a deliberate decision on the part of TI’s leadership and communications team. I strongly suspect that the serious researchers at TI who work on the CPI are slightly embarrassed by how the index is framed by the organization for public and media consumption, but there’s nothing they can do about it. Despite the apparent futility of my prior efforts, I’ll keep harping on this, in the vain hope that the message will gradually trickle out.
As regular readers of this blog are aware, since May 2017 we’ve been tracking and cataloguing credible allegations that President Trump, and his family members and close associates, have been corruptly, and possibly illegally, leveraging the power of the presidency to enrich themselves. The newest update is now available here.
A previously noted, while we try to include only those allegations that appear credible, many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. (For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.)
As regular GAB readers have likely figured out, I’m not terribly good at providing timely “hot take” reactions to news items—I’m too slow and get too distracted with other things, and by the time I weigh in on some recent development that caught my eye, I’m usually a couple of news cycles behind. So it will be with this post. But I did want to say a bit about the mini-controversy over comments a couple weeks back from Larry Kudlow, the Director of the White House National Economic Council, about the Trump Administration’s views on the Foreign Corrupt Practices Act (FCPA). For those who might have missed the reports, here’s the basic gist:
A forthcoming book about the Trump Administration includes the story (which had already been reported multiple times) that back in 2017, President Trump had vigorously complained to then-Secretary of State Rex Tillerson that the FCPA put U.S. companies at an unfair disadvantage and ought to be scrapped or drastically altered. (Tillerson, to his credit, pushed back, and no action was ultimately taken.) Several pre-release commentaries on the book focused on this anecdote (see here and here), and a couple weeks back a reporter asked Kudlow about it. Kudlow responded, “We are looking at [the FCPA], and we have heard some complaints from our companies…. I don’t want to say anything definitive policy-wise, but we are looking at it.” When pressed for details, Kudlow said, “I don’t want to say anything definitive policy-wise…. Let me wait until we get a better package [of reforms].”
Kudlow’s comments triggered a great deal of critical reaction, including statements supporting the FCPA from civil society organizations like Transparency International and the Coalition for Integrity. These statements were forceful but measured, mainly emphasizing the benefits of the FCPA. Some other media reactions were more impassioned, playing up the narrative that the Trump Administration was planning to push for the legalization of (foreign) bribery (see here and here). That latter strain in the commentary, in turn, provoked pushback from other analysts, who saw Kudlow’s remarks (and perhaps also the President’s own statements and actions in this area) as no big deal (see here and here).
My own take is somewhere in the middle. On the one hand, we shouldn’t exaggerate the significance of Kudlow’s remarks. But neither should we dismiss them as meaningless or harmless. Continue reading
A new episode of KickBack: The Global Anticorruption Podcast is now available. This episode features an interview with Andrés Hernández, the executive director of Transparencia por Colombia (the Colombian chapter of Transparency International). During the interview, Mr. Hernandez covers a range of topics including corruption in the Colombian judicial system, problems in the system for appointing senior public officials, the background and consequences of Colombia’s recent popular referendum of a slate of anticorruption measures, and how corruption may be a factor in recent popular street protests throughout the country. In the later part of the interview, Mr. Hernandez and I also discuss the proposal for the creation of an International Anti-Corruption Court, which the Colombian government has endorsed. The interview concludes with some broader reflections on how the corruption challenges have changed over the past two decades, and why there might be some reasons for cautious optimism about the potential for significant progress going forward.
You can find this episode, along with links to previous podcast episodes, at the following locations:
KickBack is a collaborative effort between GAB and the ICRN. If you like it, please subscribe/follow, and tell all your friends! And if you have suggestions for voices you’d like to hear on the podcast, just send me a message and let me know.
Today’s guest post is from Abigail Bellows, a nonresident fellow at the Carnegie Endowment for International Peace and an independent governance consultant. Ms. Bellows previously served in the U.S. Department of State, where she created and led the anticorruption portfolio in the Office of the Under Secretary for Civilian Security, Democracy, and Human Rights.
In countries long plagued by pervasive corruption, a wave of global protests is disrupting the political order. These protests, typically triggered by a corruption scandal, produce a brief upswing in political will and may result in the ouster of the current government. In fact, 10% of countries of countries around the world have experienced corruption-fueled political change over the last five years. These settings present historic opportunities to produce genuine, lasting reform. But to succeed, reformers must take advantage of political momentum before public interest dissipates or opponents regroup. During these windows of opportunity, U.S. support can play a valuable role, both because of the symbolic power of U.S. support and because of the scale and rigor of the technical assistance that the U.S. can provide. Yet all too often, the U.S. government is unable to respond sufficiently and quickly to support reformist governments during these crucial windows of opportunity. One of the main reasons is that the current U.S. anticorruption budget is too small ($115 million annually), too geographically rigid, and insufficiently flexible (given that programming is typically planned and budgeted two years in advance).
New legislation pending in the U.S. Congress—Countering Russian and Other Overseas Kleptocracy (CROOK) Act—would help address these problems. The House version of the CROOK Act, which was introduced on July 18, 2019 by Representative Bill Keating (D-MA) and Representative Brian Fitzpatrick (R-PA), with support from the U.S. Helsinki Commission, passed the House Foreign Affairs Committee on December 18. The companion Senate bill was introduced on December 11 by Senator Roger Wicker (R-MS) and Senator Ben Cardin (D-MD) and is awaiting review by the Senate Foreign Relations Committee. While the CROOK Act contains many measures that would strengthen U.S. anticorruption efforts, its centerpiece is the creation of an “Anti-Corruption Action Fund.” Continue reading
An updated version of my anticorruption bibliography is available from my faculty webpage. A direct link to the pdf of the full bibliography is here, and a list of the new sources added in this update is here. As always, I welcome suggestions for other sources that are not yet included, including any papers GAB readers have written.
GAB | The Global Anticorruption Blog 