Corrupt Cities

by Klitgaard, Robert E.; Maclean-Abaroa, Ronald; Parris, H. Lindsey

• ISBN13: 9780821346006
• ISBN10: 0821346008
• Format: Paperback
• Copyright: 1999-11-01
• Publisher: World Bank

Summary

The movement toward decentralization, accountability, and democratic forms of government at the local level is gathering momentum and the enormous costs of corruption are being explicitly recognized. Corruption is an entrenched symptom of misgovernance often reflected in patronage, red tape, ineffective revenue-generating agencies, large-scale bribery in procurement, and failure to deliver services to city dwellers. But when local officials are accountable to their citizens, decisionmaking can become participatory. In turn, a participatory process can be the cornerstone of a strategy to reform 'sick' institutions and improve the welfare of city dwellers.'Corrupt Cities' is an important contribution to this emerging field, addressing the historical, traditional, and cultural contexts that create perverse incentives for corruption to exist. At the same time, this book provides practical solutions and a set of incentives charting a path away from misgovernance toward effective local governance.The authors present case studies of both success and failure to underscore that addressing corruption is only an entry point to deeper public-sector reforms. The book serves as a guide for local reformers and citizen groups intent on changing corrupt systems by introducing practical strategies to combat corruption and to reform local institutions. Practical tools and approaches are presented, including fiscal transfers, systems to track public revenues and expenditures, simplified rules to improve the procurement process, diagnostics, and participatory techniques for developing and monitoring local budgets.

Author Biography

Robert Klitgaard, Dean and Ford Distinguished Professor of International Development and Security at the RAND Graduate School in Santa Monica, California Ronald MacLean-Abaroa, four-time elected mayor of La Paz, making him the longest democratically tenured mayor in Bolivia's history; minister of planning and foreign minister of Bolivia; manager of successful private companies and his own consulting firm; and a founding member of Transparency International and its first president for Latin America H. Lindsey Parris, management consultant on matters of organizational reform and retired U.S. Air Force colonel who managed aspects of the Strategic Defense Initiative and served on the staff of the National Defense University

Table of Contents

Institute for Contemporary Studies Foreword	vi
World Bank Institute Foreword	viii
Preface	xi
The Importance of Corruption	1	(16)
What Is ``Corruption'' and Why Is It Harmful?	1	(7)
Definition	1	(3)
An Example	4	(4)
Why Is Corruption Such a Salient Issue Today?	8	(3)
Why Do Many Efforts to Combat Corruption Fail?	11	(6)
Formulating a Strategy	17	(14)
Example of a Preventive Strategy	17	(7)
How to Formulate a Strategy	24	(7)
Corruption as a System	31	(18)
An Economic Approach to Corruption	31	(3)
Corruption as a Crime of Calculation	34	(2)
A Framework for Policy Analysis	36	(5)
Applying the Framework to Hong Kong	41	(5)
The Example of Procurement	46	(3)
Assessing Corruption	49	(18)
Participatory Diagnosis	49	(5)
What Participatory Diagnosis Is	50	(1)
How Participatory Diagnosis Might Be Carried Out	50	(4)
Technical Studies and Experiments	54	(6)
Involving the Private Sector and Citizens	60	(7)
Implementing Reform	67	(28)
Organize the Fight against Corruption	67	(7)
Pick Low-Hanging Fruit	74	(3)
Align with Favorable Forces	77	(1)
Rupture the Culture of Impunity	78	(7)
Fry Big Fish	79	(2)
Make a Splash	81	(4)
Change Systems	85	(4)
Work with Bureaucracy Not against It	89	(6)
Begin with Something Positive	89	(1)
Emphasize Information and Incentives	90	(5)
Conclusions and Extended Remarks	95	(22)
An Examination of Corruption	95	(2)
The First Battle of La Paz	97	(5)
Diagnosis	99	(1)
Strategy	99	(3)
Implementation	102	(1)
Summary of Steps for Fighting Corruption	102	(1)
Sustaining Reforms	102	(7)
Information and Incentives	109	(8)
Appendix: Corruption in Procurement	117	(34)
A Stylized Four-Step Procurement Process	120	(1)
Types of Corruption That Characterize Each Step	120	(2)
Conditions Most Conducive to Corruption	122	(2)
Indicators of Potentially Corrupt Activity	124	(1)
Policy Remedies	125	(10)
Recent Work on Procurement	135	(6)
Second-Order Effects	141	(10)
Dual-Sourcing	143	(1)
Protest Mechanisms	144	(2)
Concluding Remarks	146	(5)
Notes	151	(6)
Index	157	(5)
The Authors	162