You are twice as likely to pay a bribe if you live in a poor country

That’s a simple summary of Transparency International’s 2013  Corruption Perceptions Index.

A big headline this year was the drop in Spain’s ranking because of a number of public scandals.  But do not imagine that corruption in Spain has actually gone up or down, just because perception has changed.  Actual corruption is pretty much the same as it was last year.

It has always been striking that the perception of corruption  has been high in Asia and low in Europe, while but on the ground experience suggests Ireland is more corrupt than Thailand.  I suppose people expect an emerging economy to be corrupt and expect that Ireland is honest.  In fact, corruption in Ireland is covered over, ignored or simply accepted because people are too nice.  We rarely own up to the crooked politicians and business owners, and we let most of them off the hook.  That is a shame for us all.

In general, corruption around the world is waning, as it must.  Few benefit from crooked dealings, while most of us suffer.  It is unfortunate that the institutional approach to reducing corruption is with bureaucracy rather than education and enlightened morality, because rules increase transaction costs, reduce flexibility and must inevitably be changed to adapt to new circumstances.