1. 1 HIGHER SCHOOL OF ECONOMICS, Moscow CORRUPTION: PERCEPTION vs. EXPERIENCE IN RUSSIA Professor RICHARD ROSE FBA Director, Centre for the Study of Public Policy U. of Strathclyde, Glasgow email: prof_r_rose@yahoo.co.uk Tuesday, 15 November 2011 6pm

2. IMPORTANT DISTINCTIONS DEPARTURES FROM FORMAL NORMS. E..g. breaking bureaucratic rules (favouritism to friends) or illegal behaviour, e.g. embezzlement, bribery. A broad definition of corruption is that it involves bribery, the exchange of money to secure a personal benefit through illegal or unbureaucratic activity. BRIBERY can be payment for WHOLESALE benefits (e.g. the right to exploit mineral resources, a contract for building a major highway) or RETAIL benefits (an individual getting a hospital operation or police ignoring a speeding violation). MEASURES. Perception of Corruption Index (www.transparency.org) 'What would you do if..' scenarios are also used. Experience of corruption increasingly seen as important: e.g. Transparency International Global Corruption Barometer. 2

3. 3 GETTING THINGS DONE BY THE BOOK, BY HOOK OR BY CROOK Q. What should you do to get prompt admission to a hospital; a government- subsidized flat you were not entitled to; a permit or official document? HospitalHousingPermit (endorsing: more than one answer allowed) Use connections442438 Offer a "tip"242532 Beg, tell a story, write letter22527 Buy in the market20307* Wait, nothing can be done172520 *Percent saying do what you want without a permit Source: Centre for the Study of Public Policy, New Russia Barometer VII, 6 March - 13 April 1998. Number of respondents: 2,002.

4. 4NATIONAL DIFFERENCES IN PERCEPTION OF CORRUPTION Transparency International Corruption Index Denmark, Finland 9.4 Sweden 9.3 Netherlands 9.0 Luxembourg, United Kingdom 8.4 Austria 8.1 Germany 7.8 OLD EU 15 MEAN 7.6 Ireland 7.5 France 7.3 Belgium 7.1 Spain 6.7 Portugal 6.5 Italy 3.9 Greece 3.5 6.6 Slovenia 6.5 Estonia 5.8 Malta 5.3 Hungary, Cyprus 5.2 Czech Republic 5.0 NEW EU MEAN 4.9 Slovakia 4.8 Latvia, Lithuania 4.2 Poland 3.7 Romania 3.6 Bulgaria 2.1 RUSSIA Old EU members New EU members 1 Most corrupt 10 Highest integrity Source: Transparency International, TI Corruption Perceptions Index 2007, www.transparency.org. Accessed 20 May 2008. Ratings 2010 for Russia, Greece, Italy, Bulgaria and Romania; other countries Transparency International Perception of Corruption Index 2007.

5. 5 PERCEPTION OF CORRUPTION GREATER THAN EXPERIENCE OF BRIBERY Q. To what extent do you see the following institutions as affected by corruption? Q. In dealing with any of these institutions in the past two years, was it necessary for you or anyone in your household to give a bribe? Source: Centre for the Study of Public Policy, New Russia Barometer XV, 13-24 April 2007. Number of respondents: 1,606

6. 6 HYPOTHESES ABOUT WHY RUSSIANS PAY BRIBES SERVICES DIFFER. Bribery varies with characteristics of the services that public officials provide. CAPACITY OR VULNERABILITY. Paying bribes differs with individual income or vulnerability to exploitation. CONTACT. Bribe-paying varies with individual contact with public services. EVERYBODY IS DOING IT. The more corruption is perceived as normal, the more likely individuals are to pay bribes.

7. 7 INFLUENCES ON PAYING BRIBES Dependent variable: Number of bribes paid 0-7 Variance accounted for:1.6%14.3%18.7%21.3% Beta Capacity to pay Age-.11***-.07**.04 Education.03.01.00.01 Social status.02.01 Income quartile.04.05.03.02 Contact with officials Number of contacts-.36***.35*** Political awareness Learn from friends---.11*** Learn from what I see---.10*** Learn from media---.06* Political interest---.01 Everybodys (not) doing it Bribery acceptable--.18***.16*** Perception of corruption--.10***.05* ***Significant at.00 **Significant at.01*Significant at.05 Source: Centre for the Study of Public Policy, New Russia Barometer XV, 13-24 April 2007. Number of respondents: 1,606.

8. 8 INFLUENCES ON PERCEPTION OF CORRUPTION Dependent variable: Perception that seven public services are corrupt Variance accounted for : 16.4% (Range 4, almost all corrupt to 1, very few. Mean: 3.2) bs.e.Beta Capacity to pay Age-.00.00-.01 Education.00.02.00 Social status-.02.01-.04 Income quartile.02.03 Contact with officials Number of contacts.00.01.00 Number of bribes paid.02.03 Political awareness Learn from friends.10.02.16*** Learn from what I see.09.02.15*** Learn from media.08.02.11*** Political interest-.02.02 -.03 Everybodys (not) doing it Officials act fairly-.17.02-.21*** Bribery acceptable.02.03 ** Significant at.00 *Significant at.01 Source: Centre for the Study of Public Policy, New Russia Barometer XV, 13-24 April 2007. Number of respondents: 1,606.

9. 9CONSEQUENCES FOR REGIME SUPPORT Dependent variable: Support for political regime. Variance accounted for: 39.6% (Range plus 10 to minus 10; mean: + 1.9) bs.e. Beta General perception of corruption Number of contacts-0607-02 Number of bribes paid-1713-03 General perception corruption-1014-02 Mean perception, corrupt services242003 Bribery acceptable001200 Political performance Evaluation current economy510254** Trust political institutions351009** Officials act fairly591609** Feel freer now381406* Regime is democratic160606* Political awareness Learn from friends271305 Learn from what I see131203 Learn from media-1514-02 Political interest241205 Ability to pay Age-0001-00 Education-2012-04 Social status140904 Income quartile-0211-00 ** Significant at.00 * Significant at.01

10. 10 IMPLICATIONS LEVELS OF CORRUPTION DIFFER BY CONTEXT. Post-Soviet countries perceived as more corrupt than: Ex-Communist bloc countries of Central & Eastern Europe now in EU Ex-African colonies of Britain WHATEVER THE LEVEL, CONTACT WITH PUBLIC OFFICIALS MATTERS MOST Can contacts be made more rule-bound, fairer? BRIBERY VARIES WITH SERVICES Bribery more common for people as citizens than as consumers