May 30, 2006

Tennessee Ranks High in Public Corruption

Tennessee is one of the most politically corrupt states in the nation, according to a study, Corruption in America, by two Harvard University economists, based on the number of federal convictions of corrupt public officials. The data is pre-Operation Tennessee Waltz - so our ranking is likely to rise! The Harvard economists' study looks at the relationship between public corruption, education and income levels, and ethnic diversity.

The benefits of corruption come from government actors being able to allocate resources, including the right to bypass certain regulations, to private individuals. As such, the benefits to a political actor from being corrupt should be increasing in the size of government and in the individual's discretion over government actions. Greater numbers of regulations also increase the opportunities for helping private actors evade these regulations, therefore increasing the possibilities for bribe taking. The size of the economy can increase the returns to bypassing regulations or to corrupting the legal system.

The Harvard economists say that "ethnic heterogeneity increases corruption" because, "as voters become more diverse along ethnic or income lines, then voting will inevitably focus on redistribution rather than on the honesty of government officials."

You can read it here in a 26-page PDF file.