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Do Government Audits Reduce Corruption? Estimating the Impacts of Exposing Corrupt Politicians

Year: 2018

Type: article

Abstract: This paper examines the extent to which government audits of public resources can reduce corruption by enhancing political and judiciary accountability. We do so in the context of Brazil’s anticorruption program, which randomly audits municipalities for their use of federal funds. We find that being audited in the past reduces future corruption by 8 percent, while also increasing the likelihood of experiencing a subsequent legal action by 20 percent. We interpret these reduced-form findings through a political agency model, which we structurally estimate. Our results suggest that the reduction in corruption comes mostly from the audits increasing the perceived nonelectoral costs of engaging in corruption.

Source: Journal of Political Economy

DOI: 10.1086/699209

Authors: Eric Avis, Claudio Ferraz, Frederico Finan

Institutions: University of California, Berkeley, Pontifícia Universidade Católica do Rio de Janeiro, National Bureau of Economic Research

Language: English

Topic: Corruption and Economic Development

Subfield: Sociology and Political Science

Field: Social Sciences

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: green

OpenAlex ID: W2898769355