I’ve been reading Poor Economics by Abhijit Banerjee and Esther Duflo recently. Review to follow, but one of things that caught my eye were the occasional stories about corruption. It’s not a big theme in the book, but I thought I’d mention it. We hear plenty about corruption, but rarely hear successful strategies for fighting it. So here are three:
- Policemen in Rajasthan, India, were assessed on the number of unsolved cases. To keep their stats low, the police took as few cases as possible. More victims of crime were turned away than were taken seriously, with only 40% of reported crimes being taken on by the police. To help solve the problem, the police department worked with NGOs to set up decoy victims – people who would come into the police station and report a crime, something small like having their cell phone stolen. If the police didn’t take the case, they reported back. If they were taken seriously, they immediately told the police they were part of a scheme and that the case wasn’t real. As soon as the word got out that the decoy programme was running, the number of cases taken went from 40% to 70%.
- During the 90s, the Ugandan government’s schools budget had a set amount for each school, based on the number of pupils, intended to maintain buildings and buy textbooks and so on. Many schools said they never got it at all, or a fraction of the budget they were supposed to get. So two researchers sent survey teams to the schools in the programme and asked how much they received, and then looked at the records of how much they were supposed to get. As it turns out, only 13% got to the schools, and the rest vanished into pockets inbetween – just the kind of horror story aid critics love to quote.
However, that 13% figure made it into the local papers and caused considerably outrage. The Ministry of Finance was annoyed that their funds were disappearing, and started giving the newspapers monthly figures for how much was being distributed. When the survey of school budgets was repeated five years later, 80% of the money was getting through.
- The World Bank set up a road-building scheme for rural Indonesia, where small villages were given grants to build roads. The roads were getting built, but badly. Local contractors were exaggerating invoices on materials, building sub-standard roads and pocketing the difference, only for them to disintegrate under the traffic. Teams of engineers were sent to dig up tiny sections of 600 finished roads and analyse the materials use. They concluded that 20% of the materials were being stolen. From then on, all new grants were issued with a warning to the village that the road would be audited, and the incidences of theft fell by a third.
Three different stories, but all illustrating the fact that corruption can be tackled. Dishonesty can be addressed one specific problem at a time, by asking smart questions, making information available, using audits and spot-checks, and using the press to shame dishonest behaviour.