Panel from mural in the US Library of Congress’s Thomas Jefferson Building titled ‘Corrupt Legislation’.

A new way to measure corruption

Alina Mungiu-Pippidi

If it were a Conan Doyle story, it might be called The World That Does Not Change. Since the global anticorruption campaign started twenty years ago, classic governance indicators have not demonstrated real progress by the global anti-corruption industry.

Why? It may be the lack of a proper theory of transition from a governance order based on particularism to one based on ethical universalism; or the insensitivity of corruption indicators such as Corruption Perception Index or Control of Corruption, which aggregate expert opinions on corruption at national level; or the inadequacy of the anticorruption industry itself, which exports one-size-fits-all legal instruments (like whistleblower legislation) that are simply ignored in countries where a culture of impunity reigns.

We need better tools to discover what progress is really being made in the fight against corruption. To solve the mystery of the world that does not change, the European Union funded a five-year research project on corruption. The project has just launched its main tool to strengthen the anti-corruption fight: a new Index for Public Integrity.

You might ask: Do we really need another governance index? Several indices currently show how citizens and experts perceive the state of corruption in their society. This is true, but they do not tell us anything about what causes corruption in a particular country and thus how the situation could be improved. They are too non-specific and insensitive to change. They can even be used as pretexts to fire heads of anticorruption agencies who are honestly trying to do their job, as it has already happened in the post-Soviet Republic of Moldova.

The Index of Public Integrity takes a different approach. It is based on a comprehensive theory of what enables a society to control corruption, as well as on robust time-series model of determinants of corruption control, process tracing of how corruption has been controlled in historical and contemporary cases, and hundreds of tests of good governance instruments and policies. All of this evidence shows that effective control of corruption requires more than just the adoption of some legal tools. At the broadest level, it involves striking a carefully calibrated balance between the power of the state and a society’s oversight capacity. By exploring and testing factors suggested by the anti-corruption literature, the ANTICORRP research team was able to come up with a parsimonious six-factors combination that now serves as the basis for our new index.

The Index of Public Integrity (IPI) thus assesses a country’s overall capacity to control corruption. The index correlates highly with the World Bank’s and Transparency International’s measures of control of corruption — but in contrast to those measures, the IPI’s six components are transparent and fact based. Moreover, these components can actually be changed by policymakers. The index also correlates well with entirely fact based indicators that can be documented at the EU 28 level, such as single bidding in European public procurement. In contrast to merely perception-based measures of governance, IPI thus allows researchers to trace back a country’s performance to specific actionable components that can help policy makers to identify reform areas for improvement.

The IPI consists of the following six components:

  • Judicial independence, as measured by the Global Competitiveness Database developed by the World Economic Forum, which captures to what extent a non-corrupt judiciary system exists that is able to impose legal constraints impartially.
  • Administrative burden, which is is a measure of power discretion, as red tape is associated with a high risk of corruption. This measure is calculated from the average number of procedures and time needed to start a business and pay corporate taxes from the World Bank’s Doing Business dataset.
  • Trade openness , which measures the extent of regulations concerning a country’s external economic activities, such as the average number of procedures and time for exporting and importing.
  • Budget transparency, which measures the public access to the executive’s budget proposal as a control mechanism for discretionary public spending, based on a section of Open Budget Index.
  • E-citizenship, which captures the empowerment of citizens through online tools and social media in the exercise of social accountability.
  • Freedom of the press, a measure developed from Freedom House, which measures the degree of media independence resulting from a specific national legal, political and economic environment.

The IPI data and the interactive online tool provided on its website are aimed to help policy-makers and civil society leaders to develop evidence-based strategies to control corruption. The IPI identifies important areas for reforms and allows comparisons across countries and time. Anticorruption fighters need to approach the problem of corruption holistically, and understand that the components of the index all work in interaction to create a balanced policy framework. In the absence of an optimal equilibrium between state power and societal oversight capacity, no isolated silver bullet can make a country change.

Alina Mungiu-Pippidi is a professor of policy analysis and democracy at Hertie School of Governance in Berlin. Her book The Quest for Good Governance: How Societies Develop Control of Corruption was published by Cambridge University Press in 2015. The development of the Index of Public Integrity is described in more detail in this paper.