Corruption as a form of market efficiency is a classic argument in the development literature from the 60s, IIRC. Huntington in his 1968 book Political Order in Changing Societies spent several pages making that argument. The Indian sarkar wised up to this several years ago when it started to offer "express" service to set up your phone quickly for a hefty fee.

Very good post, Amardeep.

The bribe not only avoids the waste of time involved in an RTO visit. More significantly(for me), it eliminates the humiliating interaction with the babus. Every visit to a government office involves a little loss of self-respect. The utter lack of respect that the babus show to normal people make us feel absolutely powerless. It's not a nice feeling.

I have always wondered why is it that there are no politicians who try to face an election with the manifesto clearly saying they will eliminate corruption in government offices (atleast in RTOs). It is not a tough thing to do, and will surely win lots of votes. Moreover, the politicians most likely don't get a cut from the RTOs.

disney world has capitalized on this sort of corruption for years by offering fast tickets. you pay more and you get to sashay past all those poor sweat-soaked sods who have waited three hours in line for It's a Small World After All and Big Thunder Mountain:) you feel really guilty and exhilarated at the same time.

Eswaran, it's interesting -- your comment both calls for an end to corruption in govt. offices, and explains why it's actually a good thing in some ways. (Incidentally, could you give us an example of a case where you felt mistreated at a govt. office?)

Maybe in paralllel with the anti-corruption agenda there should be an emphasis on performance-based employee evaluations. The chai-drinking, red-tape wielding bureaucrats (Evil Babus) will only get more efficient if there is a real threat of being fired...

corruption pays. i know from personal exp. in my family, my father didn't go into engineering specifically because in bangladesh that is a corrupt profession due to its public sector focus. my uncle is a senior civil servant who lives in a small apartment while all of his subordinates live in mansions. then again, a familial reputation for uncorruptability also pays :)

anyway, bangladesh is so corrput because people don't get paid...except in bribes.

Amardeep,

One of my friend was involved in an accident and had his motorcycle confiscated by the traffic police while he was treated at the hospital. Since he didn't know the local language(and didn't have a vehicle), I accompanied him on several visits to the RTO and the traffic police station. We initially resisted paying bribes to the touts, until the vehicle inspector at the RTO directly told us.."Either pay me, or I will invalidate your driving license". All that time spent was futile because we finally paid the money anyway - maybe just a few hundred rupees lesser without the tout's cut.

Within a few months, I was planning to give my motorcycle to my dad. The procedure for this involved getting a form filled by someone at RTO, then getting a NOC from the Police Commissioner's office and then coming back to the RTO to finalize the sale(?). I immediately paid 1500 rupees (to give my bike to my dad!!) to a tout and got everything done the next day.

The lesson I learnt is that corruption will not (should not!!) go away without the procedures getting simpler, without reduced powers to the babus. It will truly be disastrous if the government officials stopped accepted bribes and started following the rules to the T!

i'm not sure that paying for expedited service necessarily makes things more efficient. at disney world, the people who don't pay for faster access actually end up having to wait much longer because there is a constant stream of people who have paid for fast tickets cutting in line in front of them. it's only more efficient for the people who are willing to pay.

An article which covers this in detail: Are Indians corrupt? A long read, and the comments to the article are worth a read too.

M. Nam

Whose God, yes the logic only works if it's a limited number of people, and if the overall social cost can justify it. With traffic, studies have shown that traffic in U.S. cities will pretty much expand to fill available lanes, so even if a toll lane were free it would probably be blocked too.

But the Disney World example you give seems like a case where the fast ticket is basically going to make a lot of ordinary customers very unhappy at the added wait.

Eswaran, thanks for filling in the details. You sounded pretty pained in the first comment, and I was wondering what it was about. That confiscated motorcycle story would have me pretty steamed too.

but have you gone to the dmv recently? there's a loss of self respect involved there too. but then, i wonder if that's not typical of all bureacracy, since the INS seems to specialize in taking away people's dignity too.

Accepting money in return for expedited services is logical but what is not acceptable is handing over licenses without a driving test to incapable people. Such acts lead to letting loose killer machines on the roads. Unfortunately, that's the sort of corruption that is happening in India in the public & educational sectors.

since the INS seems to specialize in taking away people's dignity too.

Yes, the INS/USCIS is one bureaucratic system that desperately needs an "express" service -- both in the U.S. and India. Why does it take six months for them to process even the most simple requests?

"...Suppose you’re in a big hurry and would be willing to pay a lot to avoid waiting, while I don’t mind waiting. Then you could go ahead of me, making you a lot better off and me only a little worse off, which reduces our collective frustration.... "

From a recent class in managerial economics, I learned all about opportunity cost and utility functions and multi-part pricing. This is IT! And our good old "gorment babus" didn't even have to go to business school to learn all about it.

Wow. Deep, are you channelling Vinod or something? :-D

How else would these gov't employees make a living with the meager pay they are (were?) getting?

If DMV in NJ becomes anything like India's, I would never get tickets (cuz the state trooper would be "easy"), no points ofcourse, I can just weave in and out of traffic, no seatbelt, dark tints, and subwoofer that would make watermelons pop. Life would be just dandy

Yes, the INS/USCIS is one bureaucratic system that desperately needs an "express" service -- both in the U.S. and India. Why does it take six months for them to process even the most simple requests?

Interesting, so do we predict the advent of corruption in USCIS soon?

Ennis, Just a thought experiment, bro... I'm not going to go out and join the libertarians or anything!

ps i didnt know you actually needed a license to drive in delhi

OOPS!

Though you wouldn't know it from that article, it's worth noting that in parts of North India, the process for getting a driving license has actually become much more corruption-free in recent years. All over Punjab, for example, the application process is computerized, meaning among other things that you have to be present during the application process (for the photo), limiting avenues for corruption. It's true even in the small towns and villages. Of course, Indians are creative people, so there's still the opportunity for a bribe somewhere down the line, but it's just an interesting example of how technology can make basic transactions like these a little more transparent.

India would begin to run like a Swiss clock if they simply eliminated all government salaries and just legalized all of the bribes. The bribes seem to have been determined by some sort of a market rate and work rather efficiently.

In India, the babus do not have a concept of legally charging for many services. Let's say, in the U.S., I want to pick up a package from customs. The fine print says that the sender should include 2 copies of the invoice, but actually they sent only one copy. The US customs will make the additional copy and charge you ten dollars for this act. The babus in India, on the other hand, will give you a lot of grief for the missing copy, but nowhere in their book of rules does it say that they can charge you for the missing copy. This leaves the door open for bribes instead of simply legally charging for the service.

I vehemently disagree that Indians (or south Asians in general) are more corrupt than the French or the Americans or any of the top ranking non-corrupt countries. The evidence for this can be found in the way the bribes are honestly distributed and shared. Each person gets his cut as per the ethics governing their set. If not, the system would collapse. Since the bribery system is robust and healthy we can only conclude that it works according to some sort of honor system.

Another example that comes to mind is the hawala system of transferring money. Millions of dollars exchange hands all over the globe and there's not a wisp of a receipt to show for this. Such a system can only function if there is trust and honesty. Just because it doesn't fit in with the acceptable financial framework of the dominant powers it has been labeled a corrupt system. South asians are actually more honorable in many ways since this type of trust is not to be found in the western world. It's just the governments and general administration that needs overhauling, that's all.

"But the Disney World example you give seems like a case where the fast ticket is basically going to make a lot of ordinary customers very unhappy at the added wait."

amardeep, that's exactly the outcome. i know it seems like a silly example, but i've been both patient waiter giving the evil eye to all those fast ticket smugs and fast ticket smug (feeling guilty as well though) being given the evil eye by patient waiters. i don't think it really helps speed anything up and just exists to make disney even more money.

it reminds me of being in a supermarket when a till opens up and the sales person says "i can help someone over here." all the people who patiently waited in long lines suddenly rush to the open till and, except for the first few lucky ones, end up in just as long a line or an even longer line than the one they were in before (ok, that example had nothing to do with corruption, i just realized, and more to do with "the grass is greener" syndrome). perhaps it would work better if there were separate lines for separate rides for those willing to pay more so that they don't infringe on the other lines (much like the 10 items or less aisles in supermarkets).

i think jeet made an important point: the attitudes and working conditions of govt. employees has to change so that they have some incentive to stop behaving as if they are doing you a huge favor by actually doing what it is they are being paid to do. but then again, some individuals are just not cut out for any sort of customer service job no matter how much they're being paid or how good their working conditions are.

I think corruption is ok, depending on the situation.

If paying a few hundred rupees is getting me to the front of the line at the DMV, its cool. If it gets me a license without a driving test, that is bad.

Over the past few years one thing I have realized is that people here (in the US) do not know on how to "work the system". How many times have you been to a cashier / ticketing agent / university office when the person at the desk did not know on how to fix the problem (something really silly and simple).

Corruption in countries like India have shown people on how to "work the system".

Ooh and I was just reminded of Tirupathi, anyone who has been to the temple knows that paying a fee will get you to the front of the line (almost) and then you join the others who did not pay. I do not see a problem with that.

The corruption should be balanced my one's moral judgement, that is my personal take.

but then again, some individuals are just not cut out for any sort of customer service job no matter how much they're being paid or how good their working conditions are.

Exactly, how can they be cut out for customer service when they got the job with a "connection" in the first place. People used to say that with a government-desk job you are set for life. So stick with these jobs like glue and milk it for all its worth.

There is a hindi tv show "office-office" on TVASIA about a middle class guy gettin harrassed for bribes in everyday situations. They would never do anything without their "chai-paani". Just like in restaurants, you can bribe the host/hostess to get a table quicker and with a better view.

Almost everyone in India has either offered bribe or accepted bribe for getting some work done in a government office.
Five years ago, it was impossible to get an International Driving permit from RTO (in North India) by following the rules. You had to bribe the babu or pay extra money to an "agent" to get your work done.

"Babus" are not adequately paid by the government..and not treated respectfully by the middle-class/upper middle-class customers. You can get a lot of work done by "sweet talk". Everytime a custom officer stops you, its always a good thing to talk to him respectfully and use words like "aap", "uncle", "sir" etc. Its not a good idea to talk to them in English and explain them the rules. Same is true with a traffic constables ("havaldaar")..just address him as "sir", "inspector!" and half your work is done :)
When I was 14 yrs old, I used to drive my brother's Hero Honda (motorcycle) without a license. I was stopped numerous times and asked for a driving license. Rs. 10 did the trick evrytime!

disney world has capitalized on this sort of corruption for years by offering fast tickets.

A very popular temple called Tirupati in the southern India also has a "fast ticket rate" for "Darshan". Intersing isnt it!!! (So I have heared, I havent been there. So anyone who has been there, correct me if I am wrong.)

Ok, comment #22 confirms what I was saying in #25.

rc, yes, as desi nole says, tirupathi also has this system and, again, it doesn't really make the wait more efficient for the majority of devotees.

The fact that there is an "E-Z Pay" line at Tirupati temple just makes me want to heave.

Corruption is a serious problem in many countries. It leads to inefficiency, it punishes the poor, and, most troublingly to me, routinely makes ordinary interactions between citizens hostile. I’ve seen this so many times that its almost obvious to me that petty corruption on a mass scale can make a society unpleasant to live in.

What many of the comments to Amardeep’s post suggest is that corruption can be rampant without being a serious problem. Without being a problem, even. Functioning, rather, as a solution. This is interesting.

My instinct is to disagree, but I’m sure I need to think a great deal more about it.

basically we're talking about a form of privatization here, not "corruption" per se. some of these initiatives make sense to me, like the fast lanes on the highway -- it's all about the economics of resource use. others seem deeply undemocratic. i guess the key is that privatization be accountable. privatization to the benefit of a private monopoly is no progress.

basically we're talking about a form of privatization here, not "corruption" per se. some of these initiatives make sense to me, like the fast lanes on the highway -- it's all about the economics of resource use. others seem deeply undemocratic. i guess the key is that privatization be accountable. privatization to the benefit of a private monopoly is no progress.

Another issue, which is closely tied to privatization, is that attaching a monetary value to how quickly and how well you receive a service inherently privileges those who have the money. So this might not matter if it's a fairly low amount (although even that, I would imagine, adds up over time) relative to how much people earn, but if it costs, say, $200,000 to get your Parliamentarian to support the tax policy you support, that's inherently regressive. And gross.

It also creates another value system which might get obscured by the money. For example, there is already fast tracking in U.S. immigration policy--if you're a spouse of a U.S. citizen, you'll get a greencard much faster than if you're a sibling of a greencard holder. If you have a lot of connections that can vouch for you, you'll probably get a visa more quickly than your average person outside the United States. And of course what country you hold citizenship of changes things dramatically.

Adding an express lane to the green card application processing, however, seems like it would just shift the problem from some and leave the remainder behind (and even worse off), given what the priorities of the immigration system overall seem to be. The real problem with USCIS (and really the whole immigration system) imo is that the bureaucracy is not sturcturally accountable to the people it's supposed to serve.

Yes, the INS/USCIS is one bureaucratic system that desperately needs an "express" service

Actually, the INS has been offering expedited service for H-1B processing, at the rate of $1000 dollars or so (processing
time goes down to a week or two).

Is it Possible to Justify Corruption in Some Cases?

Rationalise and/or excuse, Yes. "Justify", No.

How do some societies end up corrupt while others are “clean”?

More tolerance for corruption on a political and/or societal level. Plus "trickle-down effect" etc.

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