research paper on corruption in politics

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• Published: 20 July 2023

Corruption, anti-corruption, and economic development

• Miao Zhang 1 ,
• Houli Zhang 1 ,
• Li Zhang 1 ,
• Xu Peng 1 ,
• Jiaxuan Zhu 1 ,
• Duochenxi Liu 1 &
• Shibing You   ORCID: orcid.org/0000-0002-0102-4149 1  

Humanities and Social Sciences Communications volume  10 , Article number:  434 ( 2023 ) Cite this article

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• Politics and international relations

Corruption and anti-corruption efforts are intertwined with political and economic concerns. From an economic and political perspective, as the government strives to enhance its governance capabilities, it becomes crucial to consider the costs of anti-corruption supervision and the losses incurred from corruption. This evaluation is essential for formulating a scientifically sound anti-corruption strategy that maximizes government benefits. To address this issue, the paper presents a model that incorporates levels of supervision and associated costs. The findings reveal that in the case of homogeneous officials, the optimal level of supervisory input, which maximizes government benefit, is nearly zero when per capita income is low due to budgetary constraints on anti-corruption control. However, as per capita income reaches a certain threshold, the optimal level of supervisory input suddenly rises to its maximum and decreases as per capita income increases. Alternatively, if the government adopts a zero-tolerance approach towards corruption and provides adequate remuneration to its employees, ensuring that all competent authorities can resist corruption, then corruption can be eliminated. Moreover, when officials exhibit heterogeneity in terms of their honesty levels, certain conditions give rise to a middle per capita income range, resulting in an optimal level of supervisory input that leads to a phenomenon known as “partial corruption.” During this phase, the wages paid by the government to its employees promote honesty, preventing them from engaging in corruption. However, they are unable to curb the corrupt activities of more dishonest officials. To some extent, this model also explains the challenges associated with eradicating corruption in several middle-income countries.

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Introduction

Corruption accompanies power, as the British politician Lord Acton remarked, “Power tends to corrupt, and absolute power corrupts absolutely.” Corruption, as a misuse of power, is pervasive in all societies and is widely regarded as a major barrier to social and economic development. This is particularly true for developing countries, where the implications of corruption are the most damaging (UN, 2003 ). Shleifer and Vishny ( 1993 ) were among the first academics to define corruption as “the sale of government officials of government property for personal gain.” Similarly, Svensson ( 2005 ) defines corruption as “abuse of public office for private gain.” Later, Banerjee et al. ( 2013 ) defined corruption as a “violation of rules by officials for personal gain.” This includes not just overt corruption (officials accepting bribes), but also more subtle forms of bureaucratic corruption, such as nepotism. Corruption not only undermines fair competition and public trust, but it can also lead to resources misallocation ultimately reducing overall societal welfare. Consequently, identifying and effectively combating corruption is vital for every country or government.

Economic study on corruption has generally centered on two aspects: its causes and repercussions (Nie, 2014 ). Existing research on the causes of corruption typically discusses the roles of political systems, economic development levels, openness to foreign investment, legal traditions, education levels, culture, and religion (Acemoglu and Thierry, 2000 ; James et al., 2005 ; Šumah Š, 2018 ). Some studies also look into problems such as professional ethics, traditional customs, and demographics (Dollar et al., 2001 ; Rivas, 2013 ; Lee and Guven, 2013 ). In analyzing the repercussions of corruption, two extreme viewpoints have evolved (Aidt, 2009 ): those of the ‘sanders’ who believe corruption impedes progress, and those of the ‘greasers’ who believe corruption can (in certain cases) promote development. Given the multiplicity of causes of corruption and the fact that understanding these reasons can improve anti-corruption policy, there is significantly more research studying corruption’s causes than its economic impacts. For many developing countries, analyzing the fundamental mechanisms relating corruption, anti-corruption initiatives, and economic growth could provide insights into situations where high corruption coexists with high growth. A considerable amount of empirical analysis has been conducted on the causes and impacts of corruption (Adit, 2009 ; Dong and Torgler, 2010 ; Belgibayeva and Plekhanov, 2019 ). However, the principal-agent model, viewing corruption as an “agent violating the interests or preferences of the principal to benefit a third party,” provides a novel theoretical perspective that more effectively reveals the behavioral motivations and internal mechanisms underlying corruption.

Building on this foundation, the logical starting point of this study is that officials are motivated to engage in corruption to gain additional personal benefits when they have sufficient discretionary power, when economic rent exceeds salary levels, and when corruption detection and punishment are minimal (Yin and Nie, 2020 ). The government, on the other hand, has a similar reason to pass anti-corruption legislation. Anti-corruption actions, however, are not free; the government must invest significant human, physical, and financial resources in corruption surveillance and crackdowns. The relationship between such investment and government benefit is complex and varies depending on economic progress and governmental systems. Much of the existing research considers surveillance levels and costs from an exogenous perspective, assuming that they are determined by external variables rather than government decisions. However, in reality, when selecting anti-corruption strategies, governments must frequently evaluate monitoring levels and costs endogenously, incorporating these factors into their decision-making process. As a result, finding the best anti-corruption policy is a complex and critical topic.

Therefore, this study introduces a theoretical model that endogenizes the level of surveillance and costs to better understand how to balance corruption losses and the costs of anti-corruption surveillance investments, resulting in the optimal anti-corruption strategy under varying economic and political conditions. This study offers a fresh perspective on the coexistence of high corruption and high growth in certain developing countries. Furthermore, in many developing countries, such as those in East Asia, top-down supervision and incentives, rather than periodic elections, are the dominant influencers on official behavior. As a result, this research enriches the study of official behavior, which is ideally only influenced by the level of supervision.

The paper is divided into six sections. Following the introduction, the “Literature review” section provides a brief survey of the research on corruption and economic growth. The basic model’s construction is detailed in the “The basic model” section. The “Optimal choice of government supervision investment under homogeneous officials” section presents and discusses the government’s optimal choice. The “Optimum choice of government supervision investment under heterogeneous officials” section extends the problem to include a variety of corrupt officials. Finally, the “Conclusion and discussion” section provides research discussions and conclusions.

Literature review

Corruption and anti-corruption are both political issue and economic issue. The predominant focus of the economics community on the study of corruption is its impact on economic growth. However, consensus on this particular subject has yet to be established, with three prevailing opinions often voiced in the literature.

The first viewpoint is the “Harmful Corruption Hypothesis”. A group of scholars argue that rent-seeking activities not only cause inefficiencies but also lead to enormous unproductive waste (Krueger, 1974 ; Bhagwati and Srinivasan, 1982 ). Furthermore, corruption encourages talented individuals to engage in rent-seeking activities, which reduces economic growth (Shleifer and Vishny, 1993 ; Murphy et al., 1993 ). Shleifer and Vishny ( 1994 ) discovered that when the goals of politicians and enterprises do not align with those of maximization of social welfare, result of bribery mechanism is by no means optimal. Wei ( 1997 , 2000 ) believes that corruption has a tax effect, which weakens foreign investment willingness. As for empirical research, Mauro ( 1995 ) analyzes relationship between corruption and economic growth using data from 58 countries. The result shows that corruption has a significant negative impact on investment and GDP growth. Mo ( 2001 ) examines transnational data from 1970 to 1985 and concludes that corruption directly causes a decrease in investment, a decline of human capital, and political instability, and therefore indirectly inhibits economic growth. Pellegrini and Gerlaph ( 2004 ) argue that corruption inhibits economic growth by affecting investment and trade policies. Some academics contend that corruption slows economic growth by affecting taxes (Blackburn et al., 2006 , Imam and Jacobs, 2014 , Ivanyna et al., 2016 ). After separating the indirect effects of corruption on economic growth, Swaleheen ( 2011 ) concludes that corruption has a direct negative impact on economic growth. Kunieda et al. ( 2014 ) argued that capital account liberalization would amplify the negative impact of corruption on economic growth. Gründler and Potrafke ( 2019 ) revisited the relationship between corruption and economic growth using the inverted Transparency International Perception of Corruption Index (CPI) from 2012 to 2018 across 175 countries/regions. Their study indicates that the impact of corruption on economic growth is most pronounced in autocratic countries and is transmitted to economic growth via a decline in FDI and an increase in inflation.

The second viewpoint is that “corruption leads to efficiencies”. In some countries, there are some ineffective and rigid regulations, and corruption can relieve or even circumvent those regulations that impede economic development, thereby enhancing market efficiency and economic development (Leff, 1964 ). The “queuing model” proposed by Lui ( 1985 ) describes a situation in which officials grant bribery enterprises priority when issuing business licenses, thereby accelerating approval process and improving market efficiency. The “auction model” proposed by Beck and Mayer ( 1986 ) is a concretization of the preceding model. They believe that companies that can afford to high bribes are the most likely to be the most productive. Therefore, the “auction” acquisition of operating rights will increase market efficiency. Acemoglu and Verdier ( 1998 \ 2000 ) discovers that if anti-corruption is expensive and resource allocation is significantly distorted, then the level of corruption that maximizes output or social welfare might be greater than zero. Dzhumashev ( 2014 ) believes that when government size exceeds the optimal value, corruption can increase market efficiency and stimulate economic growth. Egger and Winner ( 2005 ) discovered that corruption could stimulate direct foreign investment based on empirical research with data from 73 countries. Through enterprise-level data analysis in China, Wang and You ( 2012 ), found that corruption can enhance a firm’s revenues at a micro level. Jiang and Nie ( 2014 ) demonstrated empirically that regional corruption in China has a positive impact on the profitability of private enterprises but has no effect on the profitability of state-owned enterprises. Furthermore, natural experiments arising from exogenous changes in trade policies imply that corruption may aid private enterprises in evading government supervision, thus explaining the paradox of China’s high growth and high corruption.

The third viewpoint is that “corruption depends on its environment”. This viewpoint is a synthesis of the first two. It argues that both viewpoints have their reasons and environments for existence. Whether corruption is beneficial or not depends on the environment and system in which it lies. After restricting their sample to highly liberalized countries and controlling for some economic variables, Méndez and Sepúlveda ( 2006 ) found that the relationship between corruption and economic growth is not constant. Under the maximization of economic growth, the level of corruption is significantly greater than zero. When the level of corruption is low, it promotes economic growth; when the level of corruption is high, it inhibits economic growth. Aidt et al. ( 2008 ) found that corruption hampers economic growth when the government’s management system is relatively perfect, but has no effect when the government’s management system is poor. According to empirical research conducted by Meon and Weill ( 2010 ), the impediment of corruption to economic growth diminishes as system deficiencies increase. When system deficiencies are so severe that they result in extreme inefficiency, corruption can actually promote economic growth. Aidt ( 2009 ) reached a similar conclusion, namely that corruption only positively affects economic growth when the system is defective. Dong and Torgler ( 2010 ) discovered through empirical research on China’s data that corruption can impact economic growth in many ways, both positively and negatively. Its overall effect is the sum of all its individual effects. Zheng ( 2015 ) determined, using theoretical models, that under certain conditions, society may benefit from a certain level of corruption and that anti-corruption measures may reduce the efforts of competent officials more than those of lower ability. Alfada ( 2019 ) evaluated the threshold value at which corruption inhibits economic growth. And Petersen ( 2021 ) employs corruption scandals to explain the inverted-U relationship between democracy and corruption.

Regardless of one’s position on the advantages and disadvantages of corruption, its negative impact on social welfare cannot be denied in certain aspects, as evidenced by the preceding literature review. Extensive studies have been conducted on the consequences of corruption, and some scholars have attempted to investigate the causes and countermeasures of corruption using novel perspectives and methodologies. Due to the secretive nature of corruption, available data are frequently limited, making it difficult to draw conclusions about corruption’s underlying mechanisms. In recent years, some scholars have started employing laboratory experiments to analyze individual corruption behaviors. For instance, Banerjee ( 2016 ) employed laboratory corruption games to elucidate bribery behavior and disclose the impactful role of moral cost. This research also highlighted the crucial role of social norms against the backdrop of corrupt behavior. To explain the relationship between corruption and economic development, Yin and Nie ( 2020 ) developed a three-tier agent model involving the central government, local government, and enterprises. They proposed that companies’ adoption of non-compliant technology could spur economic growth but also lead to corruption issues. Banerjee et al. ( 2022 ), in their public goods laboratory experiment, discovered that the propensity for public officials to embezzle increased the likelihood of tax evasion among citizens, and that tax evasion in turn increased the likelihood of embezzlement. Introducing a policy to detect and penalize public officials for embezzling taxes significantly reduced tax evasion among citizens.

In conclusion, examining corruption from the perspective of anti-corruption measures seems to be a more fruitful research topic. Existing literature typically externalizes the cost of anti-corruption efforts and seeks to explore the specific pathways of corruption via its various direct and indirect impacts. However, among the numerous ways corruption impacts economic development, we cannot overlook the influence of anti-corruption efforts on economic growth. The construction of anti-corruption measures has never ceased despite the escalating phenomenon of corruption over the 30 years since China’s reform and opening up. China’s anti-corruption expenditures have reached an unignorable level, necessitating an evaluation of corruption issues from the perspective of the cost of anti-corruption supervision. In light of this, this paper proposes a supervisory model that internalizes anti-corruption efforts and examines, through comparative static analysis, how the government can choose the optimal supervisory level that maximizes social welfare under various circumstances.

The basic model

The government’s resources are limited during a country’s economic development, so policymakers should make rational and scientific decisions in preventing, regulating, and combating corruption to maximize government benefit. In order to concretize this process, this model takes anti-corruption supervision as a factor of decision-makers’ consideration and endogenously internalizes the probability that officials will be found engaging in corruption.

Consider a static economy made up of citizens, governments, and their employees. All citizens are risk-neutral rational individuals with a total of \(\lambda\) , their per capita income is \(y\) , and they pay taxes to the government at average tax rate \(t\) . The government is policymaker that seeks to maximize benefits. Government benefit is increased by gathering taxes and employing officials to implement infrastructure or public utilities projects. Obviously, the right to implement a project leaves space for official corruption, which can be detrimental to the government’s benefit. Therefore, a group of supervisors is hired to stop or prevent corruption. Thus, government employees are separated into two groups: officials and supervisors. The number of supervisors is \(n\) , and the number of officials is \(1 - n\) , for a grand total of 1. Per capita wage rate of government employees is \(w\) . To ensure that people are willing to become government employees, a minimum wage constraint should be imposed, i.e., the wage of government employees should not be less than per capita income, then \(w\) should be satisfied \(w \ge y\) . For the government, it is necessary to find an appropriate proportion of supervisors and a wage \(\left( {n,w} \right)\) for government employees satisfying the above constraints to maximize government benefit. Next, each object’s behavior will be analyzed.

Since this model focuses on the level of supervision, the number of citizens defined as \(\lambda \left( {\lambda > 0} \right)\) , per capita income \(y\left( {y > 0} \right)\) , and average tax rate \(t\left( {t > 0} \right)\) are exogenous variables. The amount of tax paid by all citizens, i.e., government’s fiscal revenue f , is

where \(\gamma = t\lambda\) .

Supervisors

The government hires supervisors to supervise the behavior of officials. Define that all supervisors are homogeneous and have two states: normal working state and abnormal working state(laziness). Assuming that the probability \(p\) found by a supervisor that an official is in an abnormal working state is a function of the number \(n_e\) of supervisors in a normal working state, that \(p\) should be an increasing function of \(n_e\) , so we may define as

That is to say, \(p\) is exactly the proportion of the number of supervisors in normal work among government employees.

Because of the information asymmetry between the government and supervisors, the government does not know if supervisors are in an abnormal working state. In order to ensure their normal work, the government provides supervisors with an incentive on the basic wage \(w\) , that is, the salaries of all officials found to have abnormal working behaviors will be confiscated and distributed equally to all supervisors as an additional incentive. Assuming that the additional benefit of laziness is zero, in addition to the normal wage \(w\) , for each supervisor, the probability that an official in an abnormal working state will be found increases when he works normally compared with laziness, and there is a potentially higher possibility \(p\) of obtaining additional benefit, therefore, the benefit of each supervisor’s choice of normal work will not be lower than that of idleness. Thus, under government’s incentive policy, every supervisor will not choose to be lazy, so there are

Then, probability \(p\) that officials in abnormal working state will be found is

The government employs officials to operate infrastructure and public utility projects. Officials are fully aware of the number \(n\) of inspectors employed by the government, and the probability that officials will be discovered engaging in abnormal work is \(p(n) = n\) . Due to officials’ participation in the implementation of specific projects, there is room for corruption. We use the concept of “corruption space” to quantify officials’ rights, which demonstrates that officials can maximize their rent-seeking benefits. Total corruption space for all officials is defined as \(b\) , while the average corruption space per official is \(b/\left( {1 - n} \right)\) . It shows that a corrupt official will receive additional benefits of \(b/\left( {1 - n} \right)\) without being discovered. At the same time, effort input in infrastructure and public utilities projects will reduce by \(b/\left( {1 - n} \right)\) .

There are two states for all officials: the normal working state and the corrupt state. In a normal working state, officials will receive a basic wage \(w\) ; in a corrupt state, there is \(p(n)\) probability that they will be found corrupt. Once found, all wages and corrupt income will be confiscated, so the expected return of an official in a corrupt position is \(\left[ {1 - p\left( n \right)} \right]\left[ {w + b/\left( {1 - n} \right)} \right]\) , and the expected return can be used to represent the officials’ utility, \(U = \max \left\{ {w,\left[ {1 - p\left( n \right)} \right]\left[ {w + b/\left( {1 - n} \right)} \right]} \right\}\) . Since \(p(n) = n\) , the formula of anticipated income can be converted to \(\left( {1 - n} \right)w + b\) .

So, if there is

where the official’s income in the normal working state is not less than the anticipated income in the corrupt working state, the official will choose the normal working state.

Conversely, if

where the official’s income in the normal working state is less than the anticipated income in the corrupt state, then the official will choose to corrupt rather than work.

The government’s objective is to maximize the government’s benefit function by choosing an appropriate proportion of supervisors and wages of government employees \(\left( {n,\,w} \right)\) . Define the government benefit function \(G\left( {n,\,w} \right)\) as follows,

where \(B\left( {n,w} \right)\) is the total corruption benefit accrued by all officials without being detected by supervisors, both \(\alpha\) and \(\beta\) are coefficients.

The government benefit function \(G(n,w)\) is as follows: The government’s budget is total income tax \(f\) , of which a portion is used to pay government employees’ wages and the rest is for infrastructure and public utilities projects. Since corruption of officials may result in loss of \(B\left( {n,w} \right)\) and proportion \(p(n)\) is recovered by supervisor, part of resources ultimately devoted to infrastructure and public utilities is \(f - w - (1 - p(n))B(n,w)\) , which defined \(\alpha (\alpha > 0)\) as government benefit generated by investment of unit infrastructure and public utilities. Consequently, the government benefit from this part is \(\alpha [f - w - (1 - p(n))B(n,w)]\) . In addition, the supervisor is only responsible for supervising the official, whereas the official contributes directly to the government benefit of the supervisor. At this level, it is evident that the larger the number of officials, the greater the government’s benefit. Assuming that, regardless of officials’ working status, their contribution to government benefit in the implementation of infrastructure and public utilities projects is \(\beta (\beta > 0)\) , the additional government benefit generated by all officials is \(\beta \left( {1 - n} \right)\) .

In light of the above model, government’s objective is to:

It shows that the goal of policymakers is to maximize the government benefit function \(G(n,w)\) within certain constraints.

Optimal choice of government supervision investment under homogeneous officials

The above-described basic model has one feature: all officials are homogeneous, and their corruption space is identical and \(b/\left( {1 - n} \right)\) . Here, we will explore the optimal choice of government under the basic model of homogeneous officials.

The government makes decisions with the goal of maximizing the government benefit function \(G(n,w)\) , which is accomplished by employing a certain number \(n\) of supervisors and setting a base wage \(w\) for each official. Individual officials, on the other hand, decide whether to engage in corruption with the goal of maximizing payoffs based on three factors: the level of wages offered by the government \(w\) , the probability \(p(p(n) = n)\) that an official in a non-normal work situation will be detected, and the exogenously given corruption space \(b\) . When the payoff \(w\) under normal work is comparable to the anticipated payoff \((1 - n)w + b\) under corrupt work, officials choose to work normally. Because government may lead to different behavior of officials when setting different wage levels, the total corruption benefit \(B\left( {n,w} \right)\) of officials will vary without being detected, thereby affecting the form of government benefit function. Therefore, it is necessary to analyze various situations to determine the optimal choice of government. The analysis is divided into three sections: first, government’s optimal choice when low wage is \(w < b/n\) ; second, government’s optimal choice when high wage is \(w \ge b/n\) ; third, government’s optimal choice \(\left( {n^ \ast ,w^ \ast } \right)\) when the first two situations are combined.

Prior to analysis, model parameters need to be constrained. Clearly, if the total corruption space B of all officials is large enough, it signifies an unlimited expansion of power, where no decision can prevent the occurrence of corruption; therefore, the total corruption space B should be controlled to a certain range. In addition, in order to reflect the informational and professional advantages of officials in the implementation of infrastructure or public utilities projects, the influence gap between unit officials and unit resources investment on government benefit should not be too large; otherwise, there would be no reason for the government to employ officials to carry out specific projects, so coefficient \(\beta /\alpha\) should be increased. In light of this, we apply the following assumptions to full text, unless otherwise specified:

Assumption 1 . The parameters \(b\) , \(\alpha\) and \(\beta\) satisfy the following condition

Optimal choice for low wage ( \(w < b/n\) )

When the wage \(w < b/n\) is low, rational officials will find that the expected income from corruption \(\left( {1 - n} \right)w + b\) exceeds that \(w\) of normal work. Under such conditions, every official would choose to engage in corrupt practices. Consequently, the subsequent discussion will be solely devoted to analyzing the optimal choices for the government to maximize the government benefit function \(G(n,w)\) .

If each official’s corruption behavior will have additional benefits \(b/\left( {1 - n} \right)\) that not discovered by supervisor, then the total corruption benefit \(B\left( {n,w} \right)\) of each official is as follows:

and the government benefit function \(G(n,w)\) is reduced to

Thus, we have the following proposition.

Proposition 1 . When wages \(w < b/n\) are lower, the optimal number of supervisors and their salaries are \(\left( {n_1^ \ast ,w_1^ \ast } \right) = \left( {0,y} \right)\) , the value of government benefit function is

The conclusion of Proposition 1 is evident in Fig. 1 . As shown in Fig. 1 , shaded area between straight line \(w = y\) , \(n = 0\) , \(n = 1\) and curve \(w = b/n\) is value \(n\) and \(w\) can be obtained. Since the objective function \(G(n,w)\) is a linear function about \(n\) and \(w\) , the indifference curve is a straight line. The closer it is to origin, greater is the objective function \(G(n,w)\) . When the indifference curve is closest to the origin, when \(n\) and \(w\) are zero and \(y\) respectively, the government benefit function reaches its maximal value.

When wages are low ( w ), the optimal choice is at the intersection of w  =  y and n  = 0.

If government does not provide sufficient wages, rational officials will engage in corruption at the risk of being caught. If the government also employs some supervisors, the contribution of illicit funds recovered by supervisors to government benefit cannot compensate for the loss of government benefit caused by wages paid to supervisors. In this case, the cost of combating corruption exceeds the societal loss induced by its acceptance. In order to maximize government benefit, a rational government will inevitably decide not to employ any supervisors, and to reduce the wages of government employees to the lowest level, that is, per capita income \(y\) .

Optimal choice for high wage ( \(w \ge b/n\) )

When wage ( \(w \ge b/n\) ) is higher, rational officials will discover that the benefits \(w\) of normal work will not be less than the anticipated benefits of corruption \(\left( {1 - n} \right)w + b\) , so all officials will choose to work normally. Similar to the previous scenario, the focus of this section will be on analyzing the government’s optimal choices to maximize the government benefit function G ( n , w ).

At this time, the total benefits of official corruption \(B\left( {n,w} \right)\) will be 0, and the government benefit function \(G(n,w)\) will be reduced to

Proposition 2 . When wage ( \(w \ge b/n\) ) is higher, the optimal number of supervisors and wages \(\left( {n_2^ \ast ,w_2^ \ast } \right)\) that the government should choose can be divided two situations:

i. If \(y < \sqrt {\beta b/\alpha }\) , then

where value of government benefit function is

ii. If \(y \ge \sqrt {\beta b/\alpha }\) , then

Graphically, if the government increases wages, the spectrum of values \(\left( {n,w} \right)\) in Fig. 1 will not fall below the curve \(w = b/n\) . As shown in Fig. 2 , shaded area between straight line \(w = y\) , \(n = 1\) and curve \(w = b/n\) is value \(n\) and \(w\) can be obtained. Currently, the objective function \(G(n,w)\) is still a linear function with respect to \(n\) and \(w\) , so the indifference curve is a straight line. Similarly, the closer to origin indifference curve represents, the greater value of objective function. Obviously, if the minimum wage constraint is small, i.e., \(y\) is small, then the optimal choice must be at the point where the indifference curve and \(w = b/n\) tangent; on the other hand, if the minimum wage constraint is large, optimal choice is at the point where \(w = y\) and \(w = b/n\) intersect, as shown in Fig. 3 .

If the minimum wage constraint is small, the optimal choice is at the point where w  =  b / n is tangent to G ( n , w ).

If the minimum wage constraint is large, optimal choice is at the point where \(w = y\) and \(w = b/n\) intersect.

If the government implements a policy to “cultivate honesty and integrity through high pay”, that is, to ensure that wages are sufficiently high to persuade rational officials to abandon the idea of corruption, then Proposition 2 describes the optimal course of action. When per capita income is very low, the government is not concerned about the impact of the minimum wage on government expenditure or government benefit. In order to ensure that payment is appropriate to “cultivate honesty and integrity”, the government will carefully consider the relationship between investment in supervisors and improvements in government benefits. It will then determine the best amount of investment and pay for supervisors. The equilibrium pay level will be more than the per capita income, and the equilibrium supervisor input will also be greater than zero. On the other hand, the minimum wage restriction has an effect on government decision-making when per capita income is high. Maintaining a large number of supervisors will be more expensive due to the high expense of paying employees. Therefore, in an ideal case, government will set the minimum per capita wage, and the number of inspectors will remain at the level necessary to “cultivate honesty and integrity” even if officials are paid per capita. As shown by Proposition 2, as per capita income increases, the minimum wage restriction also ensures a sufficiently high wage, so the optimal number of supervisors decreases as per capita income increases. This shows that as a society becomes wealthier, on the one hand, the risk of corruption increases, reduces possibility of official corruption, and the cost of anti-corruption measures rises, causing the number of supervisors to decrease.

Optimum choice of comprehensive consideration of wages

If the government only requires a minimum wage (i.e., wage should not be less than per capita income) and does not impose a high or low wage, then when choosing optimal combination of supervisors and wages \(\left( {n,w} \right)\) , the government will consider the first two situations comprehensively to maximize the government benefit function \(G(n,w)\) and get optimal choice \(\left( {n^ \ast ,w^ \ast } \right)\) . In this way, the corollaries for proposition 1 and 2 are as follows (see appendix for proof).

Corollary 1 . If the government only restricts its employees’ minimum wage, the optimal number of supervisors and wages \(\left( {n^ \ast ,w^ \ast } \right)\) that the government should choose can be divided into the two situations below.

i. If \(y < \beta /\alpha\) , then

ii. If \(y \ge \beta /\alpha\) , then

Corollary 1 indicates that the best option for government investment in supervisors is to invest in none if per capita income y is so low that it drops below a particular threshold. The government currently believes that the benefits of fighting corruption surpass the expenses, even if only a small amount of effort is made. All officials are employed by the government. The highest degree of governmental gain will still be realized despite the lack of oversight and corruption among all officials. Specifically, if an economic society is relatively poor and has a low per capita income \(y\) , the government’s budget \(\gamma y\) will be quite limited. To improve government benefit, the government can only improve the quality of investment in infrastructure and public utilities. Therefore, government must employ sufficient officials with relevant information and expertize to operate specific infrastructure and public utilities projects. The government’s budget constrains its anti-corruption efforts. Considering that officials, whether corrupt or not, will contribute as much to government benefit as they do to the professionalism of project implementation, and that in order to obtain such “professional” benefits from officials, the government abandoned corruption supervision when the budget was limited, in such cases corruption will not offset an official’s contribution to government benefit in a “professional” way, even if the official is corrupt.

In addition, another portion of Corollary 1 states that if per capita income y exceeds a certain threshold value, the optimal choice of government investment in supervisors is greater than zero, and its value decreases as per capita income y rises. Specifically, when a society reaches a certain level of development, the per capita income is relatively high and the government will have relatively abundant budget γy . Therefore, in pursuit of high government benefit, the government does not rely entirely on officials to enhance the quality of implementation of infrastructure and public utilities projects. The government will consider officials more. Negative impact of staff corruption on government benefit maintains a team of supervisors greater than zero. Considering that when per capita income is higher than \(y \ge \beta /\alpha\) , there is \(w^ \ast = b/n^ \ast\) , the government has determined a reasonable proportion of supervisors and wage rate so that the expected income of officials in corrupt situations will not be higher than normal wage income; therefore, no rational official will participate in corruption activities under these conditions. It is worth mentioning that as a society becomes more affluent, the per capita income level y continues to rise, and the minimum wage constraint increases accordingly. As a result, the risk of corruption among officials rises, and an increase in their normal wages inhibits corruption to some extent, so the government needs fewer supervisors to ensure that a rational official is not corrupt.

Figure 4 shows the relationship between the optimal number of government supervisors \(n^ \ast\) and per capita income \(y\) . As shown in Fig. 4 , the optimal number of supervisors remains at zero as per capita income increases from zero until per capita income exceeds a critical value of \(\beta /\alpha\) , which we refer to as the “ critical value of supervising input of income.”

As per capita income y increases from 0, the optimal number of supervisors n undergoes a process of initially remaining at 0 level, then reaching a peak at b / y (when per capita income y reaches the critical value of β / α ), and finally gradually decreasing to approach zero infinitely.

The number of optimal supervisors surged abruptly to \(b/y\) and peaked at the critical point of \(\alpha b/\beta\) . As per capita income increased, the number of optimal supervisors began to decrease gradually. When per capita income approached infinity, that is, when \(y \to \infty\) , the number of optimal supervisors was infinitely close to zero. Figure 4 is also in line with reality. In fact, often poorer countries frequently lack anti-corruption measures, and corruption levels are relatively high. On the contrary, the wealthier developed countries can maintain a low level of corruption while spending less on supervision. For developing countries like China, the per capita income is at a medium-level, so it is likely located close to \(\alpha b/\beta\) (the highest level of supervision).

In addition, according to the definition of \(\alpha\) and \(\beta\) , if the influence of unit officials on government benefit is greater because of their own information or professional advantages, the impact of unit resources input on government benefit is relatively small. Then, the critical value of supervision input \(N\) will be larger, and the government will rely more on officials, so it will wait until a higher per capita income level to combat corruption. On the contrary, if the influence of unit officials on government benefit is relatively small due to their own information or professional advantages, and the impact of unit resource investment on government benefit is relatively large, then the critical value of supervision input \(N\) will be relatively small. Due to low capacity of officials, the government may take anti-corruption actions in advance to reduce losses.

Because we assume that all officials are homogeneous and confront the same size of corruption space, in this section of discussion, all officials will be in the same state, that is, all corrupt acts or all normal work. In the next section, we will introduce heterogeneous officials into the model and expand it to some extent.

Optimum choice of government supervision investment under heterogeneous officials

In reality, it is unlikely that all officials share the same “corruption preferences” or are completely homogeneous. Therefore, this section will discuss the optimal choice of government investment in supervision when officials have heterogeneous “corruption preferences”.

Assuming that only officials with a ratio \(m\left( {m \in \left( {0,1} \right)} \right)\) maintain original assumption, we refer to these Group \(A\) officials. The remaining officials with a ratio \(1 - m\) are more honest than the former. The “corruption space” has decreased due to their own reasons. We refer to them as Group \(B\) officials. Defining a “corruption preference coefficient” \(\sigma \left( {\sigma \in \left( {0,1} \right)} \right)\) , which indicates officials’ inherent degree of corruption. We believe that Group \(B\) officials, due to their own integrity, will not fully use rights allocated to them to corrupt. Therefore, they impose restrictions on themselves to alter corruption space \(\sigma b/\left( {1 - n} \right)\) . If corruption occurs with this official, he will receive additional benefit \(\sigma b/\left( {1 - n} \right)\) without being discovered, and investment in infrastructure or public utilities projects will decrease \(\sigma b/\left( {1 - n} \right)\) . The smaller the “corruption preference coefficient” \(\sigma\) , the more honest officials, and vice versa, the larger the corrupt officials. The “Corruption preference coefficient” of Group A officials are obviously 1.

Similarly, all officials may be in two states: normal work and corrupt state. Behavioral analysis of Group \(A\) officials can be found in the above model. For Group \(B\) officials, under normal working conditions, the benefit that each official will receive is basic wage \(w\) . In a corrupt state, every official has the probability of \(p(n)\) being found to be corrupt. Once found, all wages and corrupt income will be confiscated.

Therefore, under corruption, the expected income of Group \(B\) officials is

Thus, the utility function of Group \(B\) officials can be written as

Substituting \(p(n) = n\) , the formula becomes \(\left( {1 - n} \right)w + \sigma b\) . So, if there is

where the benefit of Group B officials under normal work is not less than expected benefits under corrupt work, so Group B officials will choose normal work.

Conversely, if \(w < \sigma b/n\) , where the benefit of Group \(B\) officials under normal work is less than the expected benefit under corrupt work, so Group \(B\) officials will choose corrupt work over normal work.

Obviously, the minimum wage to ensure that Group officials are not corrupt varies based on the varying levels of honesty of Group \(A\) officials and Group \(B\) officials themselves. In order to prevent corruption, the more honest Group \(B\) officials require a lower wage \(\sigma b/n\) . The optimal choice for a government, as determined by homogeneity of officials, is either to tolerate the corruption of all officials or to have zero-tolerance for corruption, as determined by the conclusion of a previous analysis. If officials’ “corruption preference” is heterogeneous, will there be an optimal choice for the government to supervise input if some officials will choose to corrupt while others do not? Intuitively, this is possible because there is a wage range \(w \in \left[ {\sigma b/n,\,b/n} \right)\) . When the wage is in this range, corruption will happen to Group \(A\) officials, but not Group \(B\) officials. If the cost of guaranteeing the non-corruption of Group \(B\) officials is less than the cost of guaranteeing non-corruption of all officials, then optimal choice of government supervision must be that wages are \(w \in \left[ {\sigma b/n,\,b/n} \right)\) , where it will be a society with “partial corruption”. Next, we will confirm existence of “partial corruption” through analysis.

Similarly, when the government formulates different wage levels, it may lead to different official behavior, resulting in varying levels of corruption income \(B\left( {n,w} \right)\) of officials without detection, which will affect the form of government benefit function. Considering the inconsistent behavior of Group \(A\) officials and Group \(B\) officials, we will discuss it in three cases: the first is the optimal choice of supervision input when the wage is low, i.e., \(w < \sigma b/n\) . The second is optimal choice of supervisory input when the medium wage is \(\sigma b < w < b/n\) . The third is optimal choice of supervisory input when the wage is high, i.e., \(w \ge b/n\) .

Optimal choice for low wage ( \(w < \sigma b/n\) )

When lower the wage \(w < \sigma b/n\) , according to the previous analysis, both Group \(A\) and Group \(B\) officials will find that the expected benefits of corruption will be greater than those of their normal work, so all officials will choose to corrupt. Corruption of Group \(A\) officials will have additional benefits \(b/\left( {1 - n} \right)\) if it is not discovered by supervisor. Corruption of Group \(B\) officials will have additional benefits \(b/\left( {1 - n} \right)\) if it is not discovered by supervisor, then total corruption benefits of officials \(B\left( {n,w} \right)\) is

and government benefit function \(G(n,w)\) is reduced to

Proposition 3 . When the wage ( \(w < \sigma b/n\) ) is lower, the optimal number of supervisors and their salaries \(\left( {n_3^ \ast ,w_3^ \ast } \right)\) are \(\left( {n_3^ \ast ,w_3^ \ast } \right) = \left( {0,y} \right)\) , the value of government benefit function is

Similar to Proposition 1, the conclusion of Proposition 3 can be obtained by making a slight modification to Fig. 1 . As shown in Fig. 5 , the shaded area enclosed between the line \(w = y,n = 0,n = 1\) and the curve \(w = \sigma b/n\) are the values that can be obtained for \(n\) and \(w\) . The indifference curve remains a straight line. The closer it is to the origin, the larger the objective function \(G(n,w)\) becomes. Therefore, when the indifference curve is closest to the origin, the \(n\) and \(w\) are 0 and y , respectively, where the government benefit function reaches its maximum.

When the wage ( w  <  σb / n ) is low, the optimal number of supervisors and their salaries satisfy n  = 0 and w  =  y .

If the salary is insufficient, then both Group \(A\) and Group \(B\) officials will choose to engage in corruption at the risk of being discovered. If government continues to employ some supervisors, even though corruption losses caused by more honest Group \(B\) officials will be less than in the previous model, the contribution of corrupt funds recovered by supervisors to government benefit still cannot make up for wages paid to supervisors. The loss, or in this case, the cost of curbing corruption for the entire society is greater than that of tolerating it. When wages are restricted by an upper limit, a reasonable government will inevitably choose not to employ any supervisors and reduce wages of government employees to the lowest level, that is, per capita income \(y\) , so as to obtain the highest level of government benefit.

In addition, it is simple to find that the optimal value of the government benefit function is a decreasing function of both the proportion m of Group \(A\) officials and the corruption preference coefficient \(\sigma\) of Group \(B\) officials. This demonstrates that when proportion \(m\) of corrupt Group \(A\) officials m is smaller and proportion \(1 - m\) of honest Group \(B\) officials is larger, the value of optimal government benefit function is larger. At the same time, if the corruption preference coefficient \(\sigma\) of Group \(B\) officials is small, indicating that the level of honesty of Group \(B\) officials is higher, then the value of optimal government benefit function will be large. These conclusions are also in line with our intuitive understanding. The smaller \(m\) and \(\sigma\) , the more honest a society is, the greater government benefit will obviously be.

Optimal choice for medium wage ( \(\sigma b \le w < b/n\) )

When wages are in a medium range \(\sigma b \le w < b/n\) , rational Group \(A\) officials will find that the expected benefits of corruption \(\left( {1 - n} \right)w + b\) are greater than those w of normal work, while rational Group \(B\) officials will observe that the expected benefits of normal work will not be less than those of corruption \(\left( {1 - n} \right)w + \sigma b\) at this time, as all Group \(A\) officials will choose corruption work and all Group \(B\) officials will choose normal work. Currently, total revenue of corruption \(B\left( {n,w} \right)\) is as follows

and the government benefit function \(G\bf \left( {n,w} \right)\) is reduced to

Thus, we have the following proposition (proof omitted).

Proposition 4 . When wages are within the medium-level range \(\sigma b \le w < b/n\) , the optimal number of supervisors and their salaries \(\left( {n_4^ \ast ,w_4^ \ast } \right)\) depend on income per capital y .

i. If \(y < \sqrt {\sigma b\left( {\beta - \alpha bm} \right)/\alpha }\) , then

where the value of government benefit function is

ii. If \(y \ge \sqrt {\sigma b\left( {\beta - \alpha bm} \right)/\alpha }\) , then

As depicted in Fig. 6 , if the government sets wages at the mediate-level, the range \(\left( {n,w} \right)\) of values will be between curves \(w = b/n\) , \(w = \sigma b/n\) . Therefore, the value of the shadowed area surrounded by straight line \(w = y\) , \(n = 1\) and curves \(w = b/n\) , \(w = \sigma b/n\) can be obtained by \(n\) and \(w\) , At this time, the objective function \(G(n,w)\) is still a linear function about \(n\) and \(w\) , so the indifference curve is a straight line. Similarly, the closer to origin indifference curve represents, the greater value of objective function. Similar to previous results, if the minimum wage constraint is small, that is, \(y\) is small, then the optimal choice must be at the point where difference curve and \(w = \sigma b/n\) are tangent. If the minimum wage constraint is large, however, the optimal choice is the intersection of \(w = y\) and \(w = \sigma b/n\) .

If the minimum wage constraint is small, the optimal choice must be at the point where difference curve and w  <  σb / n are tangent. If the minimum wage constraint is large, the optimal choice is the intersection of w  =  y and w  <  σb / n .

The situation described in Proposition 4 is a form of “partial corruption”, in which only a part of officials (Group \(A\) officials) will be corrupted while the rest will not. If the government can only set wages within a certain range, which may lead to “partial corruption” due to certain constraints, then the government’s optimal choice is as outlined in Proposition 4. When per capita income is very low, the government is unconcerned about the impact of the minimum wage on government expenditure or government benefits. Government will thoroughly evaluate the relationship between investment in supervisors and improvement in government benefits, and determine an optimal investment of supervisors and wage level. Since it cannot fundamentally restrain corruption of Group \(A\) officials, the government will employ a high proportion of supervisors to ensure investigation rate of corruption after an incident, and will also pay higher wages than the per capita income. On the other hand, when per capita income is high, however, the minimum wage constraint has a certain impact on government’s decision-making. Because the cost of paying wages is too high, maintaining a higher number of supervisors will incur additional cost. Therefore, in the optimal case, the government will establish a minimum per capita wage. As the government function cannot prevent the corruption of Group \(A\) officials, it will maintain the number of supervisors at a level that only the average salary of Group \(B\) officials can guarantee to “cultivate honesty and integrity”.

When wages are higher \(w \ge b/n\) , both Group \(A\) and Group \(B\) officials will find that the benefits of normal work will not be less than expected benefits of corruption. Therefore, all officials will opt to work normally. At this time, the total revenue from official corruption \(B\) is 0, and the government benefit function \(G(n,w)\) is reduced to

Consequently, we are in the same situation as in section 2 of the previous part, so Proposition 2 is the conclusion.

It can be seen that when the government sets a high enough wage, regardless of how different officials are, they will not engage in corruption, so the heterogeneity of officials will not influence government’s decision-making.

Optimal choice with comprehensive consideration of salary when corruption preference is heterogeneous

If only minimum wage is required (i.e., wages should be no less than per capita income) and there are no other interval constraints, the government will consider the first three situations to maximize the government benefit function \(G(n,w)\) and obtain the optimal choice \(\left( {n^ \ast ,w^ \ast } \right)\) when determining the optimal combination of supervisors and wages \(\left( {n,w} \right)\) . It is noteworthy that the optimal choice of government lead to the emergence of “partial corruption” due to the heterogeneity of officials. We are concerned about whether it is possible for the government to consider all circumstances and choose the optimal wage to be set within an interval where “partial corruption” will occur if government’s wages are not constrained by interval. First, we argue that if per capita income is low, the optimal choice for government, similar to the case of homogeneous officials, is to maintain wages in per capita income without employing any supervisors. The following inferences are provided (see appendix for proof).

Corollary 2 . If only the minimum wage is constrained, then when \(y < \sqrt {\beta b/\alpha }\) , the value of the government benefit function is \(\left( {n^ \ast ,w^ \ast } \right) = \left( {0,y} \right)\) , where the value of government benefit function is

Corollary 2 demonstrates that if the per capita income \(y\) is below a certain value, the optimal choice for government investment in supervisors is to not invest in any supervisors. Similar to the previous part of Corollary 1, Corollary 2 states that when per capita income is low, the government’s budget and limitations cannot support the cost of anti-corruption. Even if society is relatively honest, that is, there are smaller \(m\) and smaller \(\sigma\) , the government will not raise wages to combat the corruption of the more honest Group \(B\) officials.

Obviously, we know from corollary 2 that if \(y < \sqrt {\beta b/\alpha }\) , the optimal choice of government does not occur to be “partial corruption”. Then when \(y \ge \sqrt {\beta b/\alpha }\) , is it possible for this situation to occur? The answer is yes; we provide lemma (see appendix for proof).

Lemma 1 . Denote a function of \(m\) :

where \(\delta = \beta /\alpha\) . There exist \(\sigma \in \left( {0,1} \right)\) and \(m \in \left( {0,1} \right)\) such that \(\sigma < g\left( m \right)\) .

In other words, set \(p = \left\{ {\left( {m,\sigma } \right)\left| {\sigma < g\left( m \right),m \in \left( {0,1} \right),\sigma \in \left( {0,1} \right)} \right.} \right\}\) satisfies \(P \ne \emptyset\) .

As a result, we stipulate that government’s optimal choice may lead to “partial corruption”. Assuming that Assumption 2 is true, we provide Proposition 5 (See Appendix for proof).

Assumption 2 . The ratio \(m\) of Group \(A\) officials and corruption preference coefficient \(\sigma\) of Group \(B\) officials satisfy the following constraints:

Proposition 5 . If only the minimum wage of its employees is constrained, then, if and only if Assumption 2 holds, there exists a per capita income range that causes “partial corruption” if the optimal supervising input level chosen by the government is optimal. The government weighs the number of supervisors and wages \(\left( {n^ \ast ,w^ \ast } \right)\) that maximize government benefit in all cases into three categories.

i. If \(y < \frac{{\delta - bm}}{{1 - m}}\) , then

at this time, the value of government benefit function is

ii. If \(\frac{{\delta - bm}}{{1 - m}} \le y < \frac{{\delta \left( {1 - \sigma } \right)}}{m} + \sigma b\) , then

at this time, value of government benefit function is

iii. If \(y \ge \frac{{\delta \left( {1 - \sigma } \right)}}{m} + \sigma b\) , then

In the case of Assumption 2 being satisfied, cases i and ii in Proposition 5 are analogous to those of Corollary 1; that is, when per capita income \(y\) is very low and even lower than a certain critical value, the optimal choice for investing in supervisors is zero. Now, all officials will attempt to corrupt, but when the per capita income \(y\) is high enough and even higher than some critical value, the government will invest more in supervision to prevent corruption. Notably, in case ii of Proposition 5, when per capita income \(y\) is at a mediate-level, the optimal choice for the government is to invest a certain number of supervisors to prevent Group B officials from engaging in corruption. In other words, the government believes that only the most honest officials will not invest in corruption supervising costs. Relative to government benefit, benefits are relatively small. At the same time, the cost of investing so heavily in supervisors that no government officials will attempt to corrupt them is greater than the increase in government benefit. In this way, “partial corruption” results from the government’s optimal choice.

Proposition 5 reveals the existence of “partial corruption”, but its existence is contingent on the truth of Assumption 2. When ratio \(m\) of Group \(A\) officials and corruption preference coefficient \(\sigma\) of Group \(B\) officials are within set \(P\) , it is conceivable for “partial corruption” to occur, noting definition of set \(P\) , that is, when \(\sigma < g\left( m \right)\) , there will be “partial corruption”. As far as we know, \(g\left( m \right)\) is the decreasing function of \(m\) , so when both σ and m are smaller, it is easier to satisfy \(\sigma < g\left( m \right)\) , and “partial corruption” is more likely to occur. Intuitively, the smaller the \(m\) , the fewer corrupt Group \(A\) officials and the greater the number of honest Group \(B\) officials. Government chooses appropriate supervising input so that Group \(B\) officials will not attempt to corrupt benefits of situation will be greater than the larger m , and the cost of supervising input has not changed. Therefore, it is more likely that “partial corruption” will occur. In addition, the smaller the σ is, the more honest Group \(B\) officials are. Government selects appropriate supervising input and only makes the cost of Group \(B\) officials not attempting corruption smaller than that of the larger \(\sigma\) , so “partial corruption” is also more likely to occur. To sum up, a smaller m means that stopping corruption of Group \(B\) officials will produce greater benefits, and a smaller σ means that stopping corruption of Group \(B\) officials will produce smaller costs, and the combination of the two makes the emergence of “partial corruption” possible. This also partially explains why it has always been difficult to eradicate corruption in some middle-income countries.

The result of Proposition 5 suggests a possible relationship between the optimal number of supervisors n * and per capita income y under heterogeneous officials. Figure 7 illustrates the relationship If Assumption 2. As shown in Fig. 7 , the critical value of supervising input for income \(N\) is \(N\left( m \right) = \frac{{\delta - bm}}{{1 - m}}\) .

The critical value of supervising input for income is N ( m ) = ( δ − bm )/(1 −  m ) in a period of “partial corruption”. Correspondingly, in the period of “comprehensive anti-corruption”, the critical value of comprehensive supervising of income can be denoted as L ( m , σ ) = δ (1 −  σ )/(1 −  m ) + σb .

Since \(N\left( m \right)\) is an increasing function as to \(m\) , therefore, when \(m\) is smaller, the critical value of supervising input is smaller, and the society will enter an anti-corruption period earlier as per capita income rises. Intuitively, the smaller \(m\) is, the more honest its officials, the greater the likelihood that the government will invest in proactive supervising. As the government knows that the cost of supervising honest officials is not excessively high, but because there are such officials, it will receive more government benefits.

Figure 7’s optimal supervising input exhibits two jumps compared to Fig. 4 . Obviously, the first jump in critical value of supervision input ushers in a period of “partial corruption”, whereas the second jump ushers in a period of “comprehensive anti-corruption”, so the government will invest fully in inspectors so that no officials will attempt corruption. We will turn this jump point as “ critical value of comprehensive supervising of income”, and denote as \(L\) , according to Proposition 5 and Fig. 7 , we have

Since \(L\left( {m,\sigma } \right)\) is a decreasing function as to \(m\) and \(\sigma\) , the larger \(m\) and \(\sigma\) are, the smaller \(L\left( {m,\sigma } \right)\) is, and the earlier the government will enter comprehensive anti-corruption period. Intuitively speaking, the larger \(m\) and \(\sigma\) indicates that Group \(A\) officials are more and Group \(B\) officials are less honest than Group \(A\) officials. Group \(B\) officials does not pay sufficient attention to Group \(A\) officials due to their small number and lack of difference from Group officials in terms of corruption. Therefore, the government will be more aware of anti-corruption’s flaws and will advance comprehensive anti-corruption. In addition, as shown in Fig. 5 , when per capita income is close to the “critical value of overall supervising of income” \(L\left( {m,\sigma } \right)\) , the optimal level of supervising input may be the same, but the economy and society before per capita income is \(L\left( {m,\sigma } \right)\) will produce “partial corruption”, whereas the economy and society after \(L\left( {m,\sigma } \right)\) will not. If \(L\left( {m,\sigma } \right)\) is regarded as demarcation point between middle-income countries and developed countries, then this model partially explains why poorer countries have more corruption than richer countries in terms of supervising investment at a lower level.

As shown in Fig. 7 , the optimal level of government supervision input causes per capita income range of “partial corruption” occur between the critical value of supervising input of income \(N\) and the critical value of overall supervising of income \(L\) . From the monotony of \(N\left( m \right)\) and \(L\left( {m,\sigma } \right)\) , it can be deduced that the range enlarges with a decrease of \(m\) and \(\sigma\) , and with the increase of \(m\) and \(\sigma\) . When \(m\) and \(\sigma\) reaches a certain value, the area ceases to exist and degenerates to the situation depicted in Fig. 4 , that is, “partial corruption” does not exist, as shown by Proposition 6 (see appendix for evidence).

Proposition 6 . If Assumption 2 is false and the government only restricts its employees’ minimum wage, then the optimal level of supervision input chosen by government will not result in “partial corruption” regardless of the per capita income. To maximize government benefit in all circumstances, the government weighs the number of supervisors and their wages \(\left( {n^ \ast ,w^ \ast } \right)\) . It can be divided into two cases:

i. If \(y < \frac{\delta }{{m + \left( {1 - m} \right)\sigma }}\) , then

ii. If \(y \ge \frac{\delta }{{m + \left( {1 - m} \right)\sigma }}\) , then

If Assumption 2 is invalid, then Proposition 6 gives relationship between the optimal level of supervising input level and per capita income. Its figure resembles Fig. 4 . Only difference is that the critical value of supervising input of income \(N\) is

Since \(N\left( {m,\sigma } \right)\) is a decreasing function of \(m\) and \(\sigma\) , the larger \(m\) and \(\sigma\) are, the smaller \(N\left( {m,\sigma } \right)\) is, and the earlier the government will enter a comprehensive anti-corruption period. Obviously, because \(m + \left( {1 - m} \right)\sigma < 1\) , the critical value of input from income supervising is larger than that of homogeneous officials. This is due to the fact that existence of Group \(B\) officials make the whole society more honest than homogeneous officials. Therefore, under the same level of per capita income, if comprehensive anti-corruption measures are taken. Obviously, higher benefits can be obtained in societies with greater corruption. In other words, the existence of more honest Group \(B\) officials reduce the government’s concern about corruption, resulting in the government taking supervision inputs later.

Conclusion and discussion

Corruption has always been a worldwide issue, particularly in developing countries. In light of the fact that people do not yet have a clear understanding of how to balance the cost of corruption and anti-corruption supervision input, this paper has conducted a certain amount of theoretical research in this area.

Our research indicates that when per capita income is low, the optimal level of surveillance investment is virtually zero. Specifically, in a poorer socio-economic context where per capita income is below the “surveillance investment threshold,” government budgets are severely limited and unable to cover the costs of rigorous anti-corruption measures. Even minor efforts against corruption yield societal benefits that transcend the costs of such initiatives. Hence, governments can only enhance the quality of infrastructure and public service investment to advance government benefits. The chosen strategy entails hiring enough officers with relevant information and professional skills to implement specific infrastructure and public service projects with nearly zero investment in surveillance personnel. This choice is driven by the fact that officials, whether corrupt or not, can provide the same amount of government benefit due to their professional expertize in project implementation.

Secondly, when per capita income grows to a certain level, the optimal level of surveillance investment suddenly maximizes and declines as per capita income increases but always maintains a level greater than zero. In other words, as a society develops to a certain level, per capita income rises above the “surveillance investment threshold,” allowing the government a more flexible fiscal budget. At this stage, the government’s pursuit of high government benefits does not rely solely on improving project implementation quality by officers. The government also considers the negative impact of official corruption on societal welfare, therefore maintaining a positive level of supervision, reaching a maximum when per capita income is at the “surveillance investment threshold.” Furthermore, when per capita income is relatively high, the government determines a reasonable proportion and wage rate for surveillance personnel so that officials’ expected benefits from corruption do not exceed their normal wage income. In such a scenario, no rational official would participate in corrupt activities.

Finally, when officials’ corruption levels are heterogeneous, the proportion of more honest officials is larger, and their degree of honesty is higher. There may exist a middle per capita income range where an optimal level of supervising input results in “partial corruption.” In this scenario, the government only needs to maintain supervision input at a level that prevents honest officials from engaging in corruption. This conclusion also partly explains why poorer countries have higher corruption levels compared to wealthier countries when supervising investment is at a lower level. Additionally, this paper sheds light on the persistent challenge of eradicating corruption in certain middle-income countries.

The findings of this research provide a new perspective for understanding and addressing the corruption problem. However, it is worth noting the limitations of our study. First, our model is based on idealized assumptions and does not fully consider other potential factors affecting corruption, such as cultural factors, political environment, legal system, etc. The omission of these factors may impose certain restrictions on the practical application of our model. Second, our model is theoretically driven but lacks sufficient empirical data for validation, which could lead to potential bias in our conclusions. Third, our study assumes that the government’s budget allocation is solely based on economic efficiency considerations without considering the realities of political trade-offs and societal pressures. These factors can play a crucial role in the actual decision-making process. Moreover, our study predominantly features a static model without fully considering the time factor. For instance, as socio-economic development progresses, public tolerance of corruption may change, affecting the optimal level of corruption and anti-corruption surveillance investment. Future research could build a dynamic model to examine the influence of temporal variations and multiple factors on corruption and anti-corruption surveillance investment. In addition, laboratory experiments involving corruption games provide a more intuitive and operational method to assess and understand corruption decision-making behavior, presenting another area for continued development and refinement in future studies.

Data availability

Data sharing is not applicable to this article as no datasets were generated or analyzed during the current study.

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The influence of government ideology on corruption: the impact of the Great Recession

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• Published: 21 January 2021
• Volume 38 , pages 677–708, ( 2021 )

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• Héctor Bellido   ORCID: orcid.org/0000-0002-1065-1304 1 ,
• Lorena Olmos   ORCID: orcid.org/0000-0002-1438-4581 1 &
• Juan A. Román-Aso 2  

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This paper studies the relationship between government ideology and the level of perceived corruption, using a panel data of OECD countries covering the years 1996–2015, and the effect that the Great Recession has exerted on that relationship. We find that, before the onset of the Great Recession, governments formed by one (or more) right-wing parties are perceived as being around 1% more corrupt than those formed by one (or more) left-wing parties. We also find that misuse of public funds under coalitional governments is more likely to be perceived, that the longer the party of the current chief executive has been in office, the higher is the level of perceived corruption, and that minority governments and parties with a greater weight in the legislative chamber are also perceived as being more corrupt. However, the Great Recession has altered these relationships, increasing perceived corruption as the elections come closer, and softening or changing the impact of other political variables on perceived corruption.

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Source: adaptation from the Worldwide Governance Indicators (WGI) project

Sources: adaptation from the Worldwide Governance Indicators (WGI) project and from the Database of Political Institutions (Beck et al. 2001 )

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According to the Gallup database (2015 survey).

For an extensive review of the effects of corruption, see Jain ( 2001 ).

A clarifying state-of-the-art survey can be found in Dimant and Tosato ( 2017 ).

The relationship between income distribution and corruption has been found to depend on the countries analyzed, as shown in Dobson and Ramlogan-Dobson ( 2010 , 2012 ) for the case of Latin America. The poverty rate is also positively correlated with corruption, in Gupta et al. ( 2002 ).

However, Pellegrini ( 2011 ) finds no empirical evidence on the effect of once being a British colony on corruption.

For a review, see Potrafke ( 2016 ).

Latvia was invited to join the OECD in 2016, and Lithuania and Colombia in 2018, bringing the number of member countries to 37. However, these incorporations took place out of our temporary sample, which is why these three countries are not considered in this study. In addition, some of the political variables do not cover Switzerland for the full sample, so this country is also excluded from the sample.

More details in http://info.worldbank.org/governance/wgi .

Other measures for the level of perceived corruption are based on citizens’ surveys, as the Eurobarometer. See Pellegata and Memoli ( 2016 ) for a deep analysis of this kind of indexes.

Seats held by non-classifiable parties from an economic point of view are ignored (for example, parties that focus on religious, rural, or regional factors).

The first period (1996–2006) is formed by 355 observations, and the second period (2007–2015) is formed by 278 observations.

The reason for limiting the interaction of the crisis dummy to the political and electoral set of variables is threefold. First, to be consistent with previous literature (for example, Potrafke ( 2010 ), who includes in his work a "post-Soviet" dummy similar to our crisis dummy, and which is only interacted with the political and electoral variables). Second, for the very motivation of our research: to study the effect of the Great Recession on the impact that political and electoral factors have on corruption. Finally, we believe that the impact of the economic and demographic variables incorporated into our model is independent of the economic cycle: structural aspects of a country, such as the percentage of urban population, the population, or the percentage of Protestants, will hardly vary its impact on the level of corruption due to the effect of an economic crisis.

Ratios, dummies and bounded variables, such as the WGI indices and the percentages, are included in levels, so only the per capita GDP and the size of the total population are included in logs.

The only exception is the Model 3.8, which could be affected by mis-specification.

If a government is made up of only right-wing parties, the ideology index takes value 1, while its value is 5 for governments made up of only left-wing parties. Considering that an increase of 1 point of this index is linked with 0.02 less corruption, governments made up only by right-wing parties are perceived as 0.08 points (0.8%) more corrupt than those made up only by left-wing parties.

See Miller and Dinan ( 2009 ) for OECD evidence.

We reject the null hypothesis of cross-sectional independence with values of the test from 2.790 (Model 3.8) to 5.662 (Model 3.7), thus rejecting the null hypothesis at a 1% level of significance in all the specifications.

We do not show the whole model because all the non-political variables maintain their sign and impact, except for the loss of statistical significance of the percentage of urban population.

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Bellido, H., Olmos, L. & Román-Aso, J.A. The influence of government ideology on corruption: the impact of the Great Recession. Econ Polit 38 , 677–708 (2021). https://doi.org/10.1007/s40888-020-00212-6

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DOI : https://doi.org/10.1007/s40888-020-00212-6

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According to United Nations, corruption is a systemic and adaptive phenomenon that requires comprehensive and multidisciplinary approaches for its effective prevention and combat. However, traditional approaches lack the analytical tools to handle the structural and dynamical aspects that characterize modern social, political and technological systems where corruption takes place. On this matter, complex systems science has emerged as a comprehensive framework to study highly adaptive phenomena from natural to socio-technical settings. Thus, in this article we present an empirical approach to model corruption using the concepts and tools of complexity science, mainly, complex networks science. Under this framework, we describe a major corruption scandal that took place in Mexico involving a network of hundreds of shell companies used to embezzle billions of dollars. We describe the structure and dynamics of this corporate network using available information related to their personnel and the date of the companies’ creation. We measured some global parameters, such as density, diameter, average path length, and average degree in order to provide systematic evidence on which corporate characteristics are likely to signal corruption. Moreover, this analysis also provides an objective perspective of the systemic nature of events where companies are abused for corrupt purposes, and the shortcomings of reductionistic analyses. Major corruption scandals comprise both legal and illegal deeds, in addition to several parties acting simultaneously over extended time periods. As a whole, such scandals pose enormous challenges for the study of law and put the legal design of administrative and criminal controls to the test.

Introduction

“Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly.” - Martin Luther King Jr.

“The 21st century will be the century of complexity." - Stephen Hawking

The purpose of modern governments is to establish and enforce the rules that guarantee social cohesion, personal freedom, and collective well-being. In contrast, corruption comprises everything that deviates from that purpose by distorting the goal for which all socio-political structures are created, sacrificing the well-being of the collective for the benefit of the few.

According to the UN Convention Against Corruption (UN General Assembly, 2003 ), corruption is no longer acknowledged as a local problem of the nations, but as a transnational phenomenon that affects societies in deep and several ways (Transparency International, 2018 ): on the political front, corruption is an obstacle to the development of democracies and the rule of law, affecting the political leadership and institutional legitimacy; in economy, corruption hinders growth and distorts healthy competition within the markets, deterring national and foreign investments; at the ecological level, corruption degrades the environment, destroying vital ecosystems through the reckless, unchecked exploitation of natural resources, with clear local and global consequences; moreover, corruption corrodes the fabric of society by generating environments that foster the violation of human rights. In summary, corruption produces a complex, ubiquitous and many-faceted threat to the common interests of all societies that allows for enormous systemic risks in different sectors, form local to global levels (Helbing, 2013 ).

It is well acknowledged that the theoretical and technical frameworks of traditional corruption studies are not sufficient in order to handle the highly systemic nature of this phenomenon, and that new empirical, inter-disciplinary, and scientific approaches are necessary if we are to face the complexity of corruption effectively (Mungiu-Pippidi, 2017 ). At this juncture, issues relating to legal matters find common ground with problems of a scientific nature considering that the purpose of science, technology and innovation is to study our natural, social and technological environments, aiming at a deeper understanding of such environments and the application of the obtained knowledge in order to improve our living standards (Pentland, 2015 ; Altshuler & Pentland, 2018 ). In particular, through the transformation and advancement of legal practices relevant to that goal (Livemore & Rockmore, 2019 ). In this regard, complexity science has emerged as a comprehensive framework that allows for the multidisciplinary study of natural and social adaptive systems that are found everywhere in our everyday lives (Ball, 2003 ; Mitchell, 2009 ; Vespignani, 2012 ; Thurner, Hanel & Klimek, 2018 ).

In this article we present an empirical approach to describe and model corruption using the concepts and tools of complex systems science, mainly, network science (Barabási, 2016 ; Newman, 2018 ; Thurner et al., 2018 ). Under this framework, we describe a major corruption scandal that took place in Veracruz, Mexico, between 2010 and 2016, involving a complex network of hundreds of shell companies used to embezzle billions of dollars, originally destined to diverse social programs (Animal Político, 2016 ). First, we survey the progress of traditional studies on this topic by briefly reviewing attempts at describing and fighting corruption from different academic perspectives. Second, we present a short introduction to the characteristics of complex systems. Finally, we apply the complexity and network approaches to the analysis of the Veracruz case. Here focus on the structural and dynamical features of this corporate network in order to identify the network characteristics that are more likely to signal corruption. Also, we show that corruption networks go beyond the rhetorical elements of public discourse and practice, materializing into well-defined and complex structures across different layers of information (for example, through legal representatives or administrators) and time periods (date of creation of the companies), providing an objective view of the systemic nature of this event, and the shortcomings of reductionistic investigations.

Define, measure, predict and control

From a scientific perspective (Barabási, 2010 ; Vespignani, 2012 ), modern studies on corruption should aim at defining, measuring, and predicting the phenomenon, in a way that the mechanisms and methods for its control (regulation) and elimination (combat) may be set and executed satisfactorily. In science, these objectives set the conceptual and methodological frameworks that allow results to be efficiently and effectively implemented, otherwise, the effectiveness of the methods is wanting and in a best-case scenario the results are temporarily adequate, and in the worst-case, they may be counterproductive (Milinski, 2017 ; Muthukrishna, Francois, Pourahmadi & Henrich, 2017 ). Considering this, the complexity of anti-corruption efforts lies first and foremost in the adequate development of the following: (i) definition, (ii) measurement, (iii) prediction, and (iv) control. These goals not only organize the strategies that must be implemented for the study of the phenomenon, but also, they provide a guideline for the appraisal of previous anti-corruption approaches, their limitations and their potential for future improvement.

Defining corruption

A quick check to the literature allows us to see, there is a large amount of studies addressing the conceptualization or definition of corruption (Andvig et al., 2001 ; Riccardi & Sarno, 2014 ). Several definitions for corruption have been proposed in proportion to the number of social, economic and political areas were corruption has taken place (definitions according to sector), as well as from the prism of the multi-discipline (definitions according to discipline). For example, a large portion of the literature discusses the definition of corruption from economic, legal and governmental perspectives, aiming to create a definition drawn from the “umbrella idea”, that contains concepts such as clientelism, abuse of power, state capture, and patrimonialism (Varraich, 2014 ). One may also find definitions of corruption in government and bureaucracy (Rose-Ackerman & Palifka, 1999 ), political corruption (Heidenheimer & Johnston, 2011 ; Reno, 1995 ), and the definition of corruption as moral decadence and lack of ethics (Huntington, 1970 ; Mulgan, 2012 ). Similarly, social research has focused on classifying the types and sub-types of corruption in order to be operational. For example, several categories classify corruption based on its economic magnitude with concepts such as grand corruption, structural corruption, systemic or endemic corruption, petty corruption (Andvig et al., 2001 ), and rentism (Khan & Jomo, 2000 ). It is noteworthy that the most popular definition is the one promoted by Transparency International and the World Bank that states that corruption is “the abuse of entrusted power for private benefits or gains” (Transparency International, 2018 ). This definition is influenced by non-moralistic classic concepts (Nye, 1967 ), as well as by the historical endeavor of philosophy to search for the causes and origins of corruption (Hill, 2012 ).

Even though the efforts to define corruption from general to specific settings are diverse, one may argue that those definitions have little to do in current anti-corruption efforts since at the end of the day, the legal definitions of corruption, such as bribery, embezzlement or obstruction of justice (UN General Assembly, 2003 ) are the ones against whom prosecutors and investigators can do something about it, in other words, where there’s no crime there’s no punishment. Nonetheless, the task of defining corruption is important because it bounds the subject matter, however, this task must go beyond the mere delimitation of the phenomenon in different contexts, but also strive to generate an operational and quantifiable definition, so that its causes and possible effects may the described with greater precision (Olken & Pande, 2012 ; Riccardi & Sarno, 2014 ).

Measuring corruption

Over the past 20 years, empirical sources of information have been used to have a better and objective approximation to the reality of the corruption phenomenon by establishing proxies, risk indicators, correlations among relevant indexes and socio-economic parameters (Lambsdorff, 2007 ; Olken & Pande, 2012 ). Within this academic current one may find several indexes that try to measure corruption in a standardized manner by quantifying risk levels based on experience and perceptions (Svensson, 2005 ). One may also find the economic behavior and anthropological research that studies honesty, cooperation, and reciprocity (Drugov, Hamman & Serra, 2014 ; Sah & Loewenstein, 2014 ; Arney, 2010 ). In addition, economic theories strive to explain the way in which corruption occurs by using game theory, conceptual models of transactions or trade, and moral dilemmas (Platteau, 1994 ; Yoo, 2008 ).

Even though these studies represent progress in the modern description and quantification of corruption, they still suffer from important shortcomings. For example, the interpretation of perception indexes is highly dependent on the professional expertise of the group sample (Morris, 2018 ), and suffer from conceptual limitations that tend to over-simplify the phenomenon while showing inconsistencies among results when compared to each other over different periods of time (Méndez & Sepúlveda, 2009 ). It is also well-known that these approaches are based on statistical models and socio-economic parameters that do not allow to establish causality in a precise manner, nor are they able to describe corruption acts from their micro- to their macro-properties (Mungiu-Pippidi, 2017 ). Nevertheless, important efforts have been conducted in order to establish objective risk indicators, for example, in public procurement (Fazekas, Tóth & King, 2016 ; Fazekas & Kocsis, 2017 ).

Predicting corruption

The possibility of establishing models that can be used to quantify corruption provides an opportunity not only to describe the phenomenon more precisely, but also to predict it. However, the problem of prediction is not rigorously addressed within the vast academic literature about corruption, and we know little of the aspects that may help predict these acts in a precise manner (Colonnelli, Gallego & Prem, 2019 ). For example, the statistical models used in diverse studies (Olken & Pande, 2012 ) lack the capacity of prediction due to the scope of the data used, the spatial and temporal scales of analysis, the fields of operation, and the high dependency on correlations, making nearly impossible to establish causalities for different events (Riccardi & Sarno, 2014 ). As it is, conclusions and proposals derived from such models should be considered reservedly within their respective contexts. Nevertheless, with current computing capabilities and trends towards the digitalization of information in many public sectors, the ideal and promising approaches to predict corruption risk seem to be those supported by live-monitoring systems powered by artificial intelligence (Fazekas & Kocsis, 2017 ; López-Iturriaga & Sanz, 2018 ; Colonnelli et al., 2019 ). Such systems may provide a wide range of real-time preventive capabilities (Byers, 2017 ; Altshuler & Pentland, 2018 ).

Controlling corruption

The study of corruption has helped to delve deeper into practical cases and to have a better understanding of the workings of sophisticated operational schemes by identifying the common traits of corrupt acts, types of corrupt human behavior, normative spaces and grey areas in law that might allow for corruption (Andvig et al., 2001 ). Solutions for fighting and controlling corruption proposed by these studies consist of legal reforms, novel institutional and burocratic designs, mechanisms for accountability and control, codes of ethics, awareness campaigns, among other strategies for legal combat, prevention and sanction (Riccardi & Sarno, 2014 ; David-Barrett, Fazekas, Hellmann, Mark & McCorley, 2018 ). Great efforts have been made to improve the measurement of corruption, however, these suffer from limitations in their design (Méndez & Sepúlveda, 2009 ); studies recommending solutions for corruption that consist of more rules and legal reforms are under debate due to the fact that ineffectiveness and negative impacts from overregulation may arise (Mungiu-Pippidi, 2017 ; Mungiu-Pippidi & Dadašov, 2017 ; Smilov, 2010 ). With current scandals of corruption worldwide, the results obtained thus far remain highly questionable and the criticism concerning the scientific progress in corruption studies is ever more present.

In summary, appropriate definitions of corruption would make objective measurements not only possible, but also more accurate. In turn, the correct measurement would make way for the possibility of prediction, and prediction would give rise to the intelligence needed for control. Though great progress has been made in the fight against corruption, all of these efforts suffer from the inherent limitations pertaining to the methodologies that support them. Having exact models of the causes, circumstances, mechanisms, effects and consequences of a corruption event remains as a great scientific challenge. Without a doubt, we know much more about corruption than we did 20 years ago, yet, this issue remains unsolved: we do not know how to measure it in a systematic and standardized manner, and we still have not been able to control it within existent models. It is clear that this problem demands of new conceptual, methodological and analytical frameworks that allow for the integration of all the elements that in one way or another determine the complexity of the phenomenon.

Applied complexity science

Corruption is a phenomenon that occurs within the intricate structure of social, political and technological systems, therefore, a better understanding of it requires of integral and inter-disciplinary perspectives. As with contemporary medicine or biology advances, which stand upon the progress made by disciplines such as physics, applied mathematics and computing science, social sciences have begun to use such disciplines to describe, model, explain, and even predict certain phenomena (Conte et al., 2012 ; Holme & Liljeros, 2015 ; Lagi, Bar-Yam, Bertrand & Bar-Yam, 2015 ; Wiesner et al., 2018 ; Capraro & Perc, 2018 ). This integration of disciplines previously considered totally apart from each other (natural and social sciences, and even the humanities) has been possible due to important advances in computing capabilities, knowledge-transfer and cross-disciplinary problem solving (Ball, 2003 ; Miller & Page, 2009 ; Caldarelli, Wolf & Moreno, 2018 ).

Moreover, in the scientific exploration of physical to social systems, it has been found that the hardest adaptive systems to model and control are those involving individuals whose willing decisions may give rise to collective phenomena that are not easily defined, explained or predicted by means of the analysis of isolated individuals (Ball, 2003 ; Miller & Page, 2009 ; Caldarelli et al., 2018 ; Capraro & Perc, 2018 ). In this context, corruption could be regarded as a phenomenon that occurs within systems whose structure and dynamics can evolve as a response to changes in its corresponding socio-political and regulation context, with a strong dependence on the interrelation of different factors and actors acting as a whole. In general, systems with the previous characteristics are the subject matter of complexity or complex systems science, which represents a new scientific paradigm and a new way of doing science in the twenty-first century (Mitchell, 2009 ; Thurner et al., 2018 ; De Domenico et al., 2019 ; Helbing et al., 2015 ).

Complex phenomena

In complex systems theory, a system is considered complex not only because it has an intricate structure, but also because its temporal evolution cannot be easily explained as a function of the behavior of its isolated components (Bar-Yam, 1997 ; De Domenico et al., 2019 ). In particular, there are two important concepts that help to explain the ‘complexity’ of a system, those are ‘emergence’ and ‘self-organization’ (Sayama, 2015 ). On the one hand, ‘emergence’ is a concept associated to the effects of non-trivial interrelations among the components of a system across different scales of observation or analysis. Specifically, the properties of the parts acting as a whole are called ‘emergent’ when they cannot be explained based on the properties of the parts looked in isolation, thus, global properties are different from local ones (Bar-Yam, 1997 ; Sayama, 2015 ). On the other hand, ‘self-organization’ is a dynamic or temporal process through which the solely interactions among the multiple parts of the system create collective structures and behaviors, with no intervention from a central or external organizing agent (Sayama, 2015 ). From these concepts, it becomes clear that there are two important aspects to be considered within the analysis of complex systems: the structure (statics) and temporal evolution (dynamics) of the system. In complexity science, network theory is one of the most important tools for the analysis of these structural and dynamical elements (Sayama, 2015 ; Thurner et al., 2018 ).

• Complex networks

Network theory has been applied to have a better understanding of many natural, socio-technical, and legal systems (Barabási, 2016 ; Rutherford, Lupu, Cebrian, Rahwan, LeVeck & Garcia-Herranz, 2018 ). The importance of the application of multidisciplinary and scientific approaches such as complex systems, network theory, and even physics, to the study of criminal activities was presented by the end of last century (Sparrow, 1991 ). However, it was until the last decades that these types of studies have begun to gain momentum given the great progress in computing and data science (Caldarelli et al., 2018 ) and their enormous relevance in modern social, economic, and political contexts (D’Orsogna & Perc, 2015 ; Helbing et al., 2015 ; Espinal-Enríquez & Larralde, 2015 ; Marshak, Rombach, Bertozzi & D’Orsogna, 2016 ; DellaPosta, 2017 ; Fazekas, Skuhrovec & Wachs, 2017 ; Morselli & Boivin, 2017 ; Altshuler & Pentland, 2018 ; Magliocca et al., 2019 ; Ouellet, Bouchard & Charette, 2019 ; Niu, Elsisy, Derzsy, & Szymanski, 2019 ).

Notably, although corruption studies go back a long way and have been conducted from different perspectives, corruption studies conducted from a complex systems or network theory approaches are quite recent and scarce. For instance, a recent study covering 30 years of corruption in Brazil shows that the co-occurrence of politicians in corruption scandals create networks with large connected components that might spans decades (Ribeiro, Alves, Martins, Lenzi & Perc, 2018 ). Other study proposes diverse methods for the strategic dismantling of corruption or crime networks considering their structure and the cost of removing key nodes (Ren, Gleinig, Helbing & Antulov-Fantulin, 2019 ). Another study looks into the social fabric of Hungary in order to establish the social factors associated to corruption risk in public procurement, finding that fragmented social networks are more prone to corruption risk whilst more diversity hinders it (Wachs, Yasseri, Lengyel & Kertész, 2019 ). An additional study that explores 28 years of bill-voting in Brazil shows that the dynamics of co-occurrence networks of similar-voting congressmen reveal patterns that allow for the identification of convicted corrupt politicians and also, for the possibility of predicting or identifying other possible corrupt individuals within the network (Colliri & Zhao, 2019 ). Noteworthy, the identification of latent criminal groups (Campedelli, Cruickshank & Carley, 2019 ) and the effective dismantling of their organizational structure (Wandelt, Sun, Feng, Zanin & Havlin, 2018 ) are relevant and non-trivial subjects in criminal investigations and law enforcement, since empirical evidence has shown that the dismantling process might potentially make these criminal organizations stronger (Duijn, Kashirin & Sloot, 2014 ). In addition, when it comes to fighting corruption the goal is clear: one not only is looking to describe it post factum, but to predict it (Rumi, Deng & Salim, 2018 ; Alves, Ribeiro & Rodrigues, 2018 ; López-Iturriaga & Sanz, 2018 ; Colonnelli et al., 2019 ; Wachs et al., 2019 ; Wachs & Kertész, 2019 ; Colliri & Zhao, 2019 ).

In summary, though corruption studies are diverse and tackle different aspects of the phenomenon, complex systems and network science approaches allow us to establish practical aspects for its investigation (Sayama, 2015 ; De Domenico et al., 2019 ), mainly:

Components and interactions. Complex systems are usually comprised of large sets of interacting elements or components. Both the components and their interactions may be of different types.

Network structure. The structure of a complex system may be described as a network of interactions and interrelations in which all nodes and edges evolve as a whole over time.

Self-organization. There are many interactions among components. These occur independently, with no need of intervention by central organizing agents, producing collective non-trivial phenomena.

Emergence. The collective behavior and properties of these systems can neither be predicted nor understood from the individual behavior or properties of each component in isolation.

Predictability and control. The dynamics, or temporal evolution, of a complex system are collective and often non-linear which, under certain conditions, makes the system highly unpredictable and difficult to control.

To show the usefulness of approaching the study of corruption through the complexity perspective, we will now analyze one of the most important corruption scandals in Mexico of the past decade.

• Corruption networks

In the Mexican case, recent corruption scandals tell of the complexity of the phenomenon. From governors accused of embezzlement at local levels (Ángel, 2017 ), through federal agencies and public universities awarding contracts to shell companies at a national scale (Roldán et al., 2018 ), to transnational bribery scandals (Olmos, 2018 ), corruption is ever present across all public and private sectors of Mexico. As a concrete example, here we analyze a recent and paradigmatic corruption scandal: the case of the “phantom” companies of former governor of Veracruz, Javier Duarte de Ochoa (Ángel, 2017 ; Animal Político, 2016 ).

Case, data and methodology

In one of the biggest embezzlement scandals in Mexico of recent times, the former governor of the state of Veracruz, Javier Duarte de Ochoa was sentenced by federal authorities to 9 years of prison for criminal conspiracy and money laundering, after an initial charge for organized crime and operations with illicit proceeds, and an unexpected escape and extradition from Guatemala (Animal Político, 2016 ). According to the Mexican Superior Audit of the Federation, the amount of diverted money could reach 60 billion pesos (about 3 billion dollars), originally destined to diverse social programs, security and education, but that never reached their end. As the leading investigative journalists of the case documented (Ángel, 2017 ; Animal Político, 2016 ), the embezzlement mechanism consisted of hundreds of “phantom” or shell companies, created under fake ownership, that were awarded with contracts from the local government for diverse projects but that never delivered neither the goods nor services promised. This is a case in which much of the analysis and debate centers on the legal fulfillment of the public procurement process, the failing of the control mechanisms, and the government responsibility on these matters. However, the analysis of the abuse of companies for corrupt practices is a relevant aspect at the forefront of international anti-corruption efforts (Fazekas & Tóth, 2017 ). This matter has not been formally treated for the Duarte case and it is especially important for two reasons: first, the lack of systematic evidence on which corporate characteristics are likely to signal corruption has the potential to bias our understanding of corruption, making it overly focused on the public sector (Fazekas & Tóth, 2017 ); second, the Duarte case is eminently characterized by a huge group of private companies that seem to be structured to operate as a network. Recent studies have shown that the characterization of the structural and operational features of corporate or trade networks are not simple, with different layers of information adding to the complexity of the problem (Alves et al., 2019 ; de Jeude, Aste & Caldarelli, 2019 ). Therefore, in the present analysis we focus on the description of the structural and dynamical features of the network of companies that were used in this scandal in order to find company corruption risk indicators, in particular, in the ownership and management structures.

The data used for the analysis comes from a dataset gathered from official sources (open to public access under Mexico’s General Law of Transparency and Access to Information) by the NGO known as Mexicanos Contra la Corrupción e Impunidad (Mexicans Against Corruption and Impunity) and the leading group of investigative journalists of the case, known as Animal Político (Animal Político, 2016 ). This dataset contains information about 354 companies and 356 people associated to those companies. For legal reasons, we have held all information regarding names and official ID’s of companies and people in anonymity. For each company, the dataset contains available information about their legal representatives, shareholders, administrators and commissars, as well as the notaries that formalized them. For the network analysis we considered a bipartite approach in which companies are related to people through five different types of edges: share-holders, legal representatives, administrators, commissars and notaries (see Fig.  1 a). As we show below, this classification is due to the fact that there are individuals with multiple work relationships within the same company or among different companies, therefore, instead of encoding this information into the nodes, we decided to encode it into the edges and to treat each category as layer of information for this network. Thus, each layer contains the same number of companies (354) and people (356).

Components, interactions and network structures. a Components (nodes) and interactions (edges or links) of the system. Total number of people and companies in the system is indicated. b Companies connect through the “legal representative” category. The number of connected people and companies relative to the corresponding total is indicated. c Connectivity patterns for other types of edges. d Integration of the five information layers lead to one great connected network.

As previously stated, the networks do not show the government agencies that granted contracts to private companies, since the goal of this study is to explore the companies’ personnel role in the structure and evolution of the network. As network metrics we considered the density (fraction of the number of real edges of a network to the number of its possible edges given the number of total nodes), diameter (maximum distance between a pair of nodes in the network), average path length (the average distance between pairs of nodes in the network), average degree (average of the number of neighbors for each node), clustering coefficient (fraction of closed triplets to the total number of closed and open triples, where a triplet is a subset of three neighboring nodes), number of connected components (number of connected sub-sets or sub-network), and number of multi-edge node pairs (in a multigraph or multi-edge network, these are the number of multi-edges connecting any pair of nodes) (Newman, 2018 ; Barabási, 2016 ). The network was analyzed using Cytoscape, a well-known open-source software for network analysis (Shannon et al., 2003 ).

In the following sections, we will explore the qualitative and quantitative features of Duarte’s phantom-companies network through the lens of complex systems and network science: first, the components, interactions and network structures; second, the self-organizing and emergent elements; and finally, some aspects on predictability and control.

Components, interactions and network structure

The components are defined as the participating companies and people. These define two types of nodes that are linked through five categories: shareholders, legal representatives, administrators, commissars, and notaries (see Fig. 1 a). As stated before, the information in such categories is encoded within the edges and not in the nodes, due to the fact that numerous people play several roles within the same company or in different companies. Under that classification, each type of edge reveals part of a complex network structure that is comprised of five layers of information and each layer contains the same number of companies (354) and people (356). For example, the “legal representative” category produces a bipartite network that consists of a sub-set of 139 people related to 173 companies (See Fig. 1 b). In this way, each category reveals different networks within the same system (see Fig. 1 c). These features also reflect quantitatively in the network metrics (see Table  1 ).

In general, these networks have low density (not all companies connect to all people), which is characteristic of real-world networks (Barabási, 2016 ); they also have low average degree, which means that there is a great majority of companies/people that connect to at most another one people/company in each layer; clustering coefficient equal zero, due to the fact that these networks are bipartite by construction and therefore, closed triplets are impossible to be generated. This leaves the diameter (largest distant between pairs of nodes) and average path length (average distance between pairs of nodes), that are measures of the extent to which connected companies and people are present in the network due to the fact that there are multiple people connecting multiple companies at once. As it can be observed, the “shareholder” network is the one that generates more structure among the rest of the categories, followed by the “legal representatives”, “administrators”, “commissars” and finally, “notaries” (see Fig. 1 and Table 1 ).

From the previous results, one can easily see that “shareholders” are the ones that provide great cohesion to the network, since they provide more connectivity among the total number of companies. In context, this finding provides an important insight in the way corrupt companies might be investigated, specifically, given that not all actors have the same role within this type of systems, prosecutors must be aware that looking at just one individual or group might lead to missing details of bigger schemes. Moreover, since each type of edge constitutes a single layer of information within the system, then, their integration reveals a more exact version of the network. Remarkably, after aggregating all layers into one, we find that all nodes are condensed into one fully connected and complex multigraph or multi-edge network (see Fig. 1 d and Table 1 ). This finding is explained by the fact that there are several people who perform multiple roles within a single company or among different companies (as explained further below).

The previous analysis through decomposition has advantages and disadvantages: on one hand, it allows to observe the details concerning the contribution of each information layer to the system’s structure: in corporate networks, not all players provide the same amount of information; on the other hand, when considering a single category for analysis, highly valuable information concerning connectivity among companies is excluded. This is a very important insight that complexity approach provides: if we truly wish to understand complex systems such as the ecosystem of corporate networks in contracting markets, we must be aware that excluding information -- willing or unwillingly -- can hamper our perspective of the exact workings of the system. In our case, companies that might look separated or independent from one another are then shown to be connected, forming one fully connected network, when the information about their personnel is integrated.

Self-organization and emergence

The aggregated multigraph can be decomposed as a function, for instance, of the year of the creation of the companies (Fig.  2 a, b and c). This temporal decomposition by year reveals that the large multigraph emerges from a self-organization process of sub-sets of companies created in different stages in time, that in turn create fully connected networks (Fig. 2 b). Quantitatively, these features reflect through their metrics per year. Without loss of generality, the contributions of the initial and final year to the total network are negligible and thus are discarded (see Table  2 ). In all these networks (2008–2014), both the number of nodes and edges changes over time; the number of connected components clearly shows the fact that one network of companies was created per year; the density remains low, and again, the clustering coefficient is equal to zero due to the bipartite nature of the network.

Temporal decomposition. a Decomposition of the great network of people and companies by the year in which the companies were constituted. b Extracted networks by year. The number of companies and people are indicated. c Number of companies created as function of time

Notably, metrics such as the diameter, average path length and average degree remain almost of the same magnitude per year. In short, these metrics do not provide enough information to establish corporate corruption risk indicators. However, one can take advantage of the fact that the cohesion of the multigraph arises from the total contribution of “shareholders”, “legal representatives”, “administrators”, “commissars”, and “notaries”. Here, one can measure the number of multi-edge node pairs, these are the number multi-edges connecting any pair of nodes in the bipartite multigraph. For company-nodes, multi-edge pairs correspond to the number of people with at least one role or work relationship within the company. For people-nodes, multi-edge pairs correspond to the number of companies in which a given individual has multiple roles. Remarkably, multi-edge node pairs have strong variations during the years of high creation of companies, pointing towards relevant anomalies, showing their potential as a corporate corruption risk indicator (see Table 2 ).

The behavior of separate companies is not the same as the behavior of companies acting as a whole. The self-organized dynamics of the corporate network of this case was only revealed through the full integration of all the information available on companies’ personnel. This emergent property, i.e. the way it operates as a whole complex network, is even clearer when one considers how metrics differ from each other when performed over one layer or 1 year than when performed over the aggregated multigraph. In the structural analysis per layer or in the decomposition per year, each category has its own characteristic metrics. It would be tempting to make an average of the information to infer the behavior of the whole network, however, as we can observe from the metrics of the aggregated network, these differ from simple averages (see Table 1 and Table 2 ). This is due to the fact that, in complex systems, interrelations among components are non-linear and therefore, and system properties behave in the same manner as well.

The previous results, the creation of one connected network per year and the multiplicity of edges between pairs show us that, for this network, many companies have shared the same personnel over the years, many of them with multiple roles within the same and/or among other companies, thus, reflecting a remarkable anomalous behavior in the structural and dynamical growth of this network. Also, emergent properties measured through network metrics are highly dependent on the integration of all available information across different scales of observation. Again, in complex systems, we must be aware that the temporal extension of an event like this one could reveal only a small part of the greater scheme. Excluding information -- willing or unwillingly -- can hamper our perspective of the exact workings in the system, which in our case, reveals how one fully connected network of companies is created through time.

Predictability and control

From the previous structural and dynamical analysis, we conclude that the information about the personnel associated to each company plays a key role in the description of a given event, in the definition of good corruption risk indicators, and in the possible detection of irregularities within organized schemes of network operations. Heuristically, network visualizations are a quite powerful tool that provides an intuitive base for identifying and understanding certain behaviors and patterns (Venturini, Jacomy & Jensen, 2019 ). However, the true power of network science does not entirely lie in its capacity to describe any particular system in a qualitative manner, but rather in the mathematical formalism that this framework gives to the definition, quantification and modeling of the different parts of the system. As we showed, network metrics can be defined either for each node or for the whole network, however, not all might be useful in order to characterize and detect relevant anomalies that point towards corrupt behaviors in corporate networks, specifically, multi-edge bipartite networks. In the analysis per layer or edge type, only the diameter and average length path reveal information that could be relevant for our purposes. In the analysis per year, it was the multi-edge node pairs, a measure of the degeneracy of a given node, the one that revealed interesting anomalies related to the multiplicity of work relations. Certainly, these insights could be used to define risk indicators and control mechanisms for companies participating in public procurement; but of course, they still need to be tested in further cases and in other datasets of corporate ecosystems, something that goes beyond the scope of the present article. Nevertheless, the results presented here show how complexity science along with network theory allows us to define, quantify and model a given corruption event, in order to identify and establish possible prediction and control mechanisms (Vespignani, 2012 ; Barabási, 2016 ; Ren et al., 2019 ).

Conclusions & remarks

In this article, we presented empirical evidence of a grand corruption scandal in Mexico that provides a glimpse into the complexity of events where companies are abused for corrupt practices. The analysis performed looks to fill a gap in the lack of systematic evidence on which corporate characteristics are likely to signal corruption in public procurement. To this end, we focused on the description of the structural and dynamical features of the network of shell companies of the Duarte case in order to find company corruption risk indicators, in particular, in the ownership and management structures. This was done under a complex systems and network theory approach where companies and their personnel were model as a multi-edge bipartite network:

For the structural analysis of the network (Fig. 1 ), we found that all the companies and their personnel created a one big connected component when the five layers of information were integrated. Among these, the “shareholder” layer was the one that provided more information about the connectivity of the network, followed by the “legal representatives”, “administrators”, “commissars” and finally, “notaries”. For this part, the network metrics used were non-conclusive in order to establish clear corporate corruption risk indicators (Table 1 ).

For the dynamical part (Fig. 2 ), we found that when the bipartite multigraph was decomposed into the year of companies’ creation, one connected component appeared for most years. Again, most network metrics were non-conclusive in order to establish clear corporate corruption risk indicators, except for the number of multi-edge node pairs, that provided a good measure of the degeneracy of both companies and people (Table 2 ). For company-nodes, multi-edge pairs correspond to the number of people with at least one role or work relationship within the company. For people-nodes, multi-edge pairs correspond to the number of companies in which a given individual has multiple roles.

The evidence presented here points towards the hidden complexity in other corruption events of this kind, where not all information of the parties involved is available, and the shortcomings of analysis through reductionistic eyes.

Corruption is a phenomenon that not only occurs within the complexity of private or public socio-political and technical systems, but also, it can give rise to a complex system in itself, in which the interrelations of different actors and factors acting as a whole originate characteristic self-organizing and emergent phenomena.

Empirical and multidisciplinary corruption studies are key in order to design effective anticorruption strategies. From a legal perspective, the phenomenon of corruption poses great challenges, such as the detection of concurrent practices, the correction of normative frameworks, the control and prosecution of corruption crimes, the decreasing of the incentives that feed them, and the recovery of assets. The empirical study of great corruption scandals, such as the one presented here, has revealed that corrupt activities might consist of both legal and illegal deeds, from public to private sectors, and with multi-role actors that act simultaneously over long periods of time. As a whole, they go far beyond the institutional capability and legal design of administrative controls, as well as surpassing causes of jurisdictional sanction. Nevertheless, the complexity approach has the potential to change the way in which we study and implement law. Certainly, it proves the need for improving criminal and administrative forensic investigations through the scientific innovation of studies that pertain to law and justice. In addition, great importance should be given to efforts that allow for the coordination among key actors and prosecutors, and to the exchange of information through which public and private sectors can generate relevant intelligence for the creation of effective anti-corruption networks.

Finally, complex systems science is a new paradigm for doing science as it provides a conceptual and analytical framework from which one might understand a great number of phenomena from natural to social systems. Political, economic, ecological and social systems are fine examples of complex systems that greatly impact our lives and that can be studied under the adaptive systems approach (Helbing et al., 2015 ). The major problems facing modern societies, such as climate change, migration, inequality, crime or corruption, may be more likely to be solved when public policies are based not only on science, but on a new kind of science, one that considers the inherent adaptive and systemic aspects of modern States, that is, applied complexity science (Geyer & Cairney, 2015 ). In addition, it is highly important to emphasize that the control mechanisms inferred from these types of studies will only be useful when implemented within the corresponding administrative and legal frameworks that provide them of support and operative reach (UN General Assembly, 2003 ). In this aspect, public policy based on rigorous scientific research, with complexity science as a multidisciplinary bridge, is a first step towards a new way of addressing the major issues of this century.

Availability of data and materials

The datasets used and analyzed during the current study are available from the corresponding author on reasonable request.

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Acknowledgements

We thank Arturo Ángel, Raúl Olmos and Yosune Chamizo, members of the investigative journalism group, Animal Político, and the non-governmental organization, Mexicanos Contra la Corrupción e Impunidad, for the access granted to their data records on the “Phantom Companies of Veracruz” case.

Research funded by Universidad Nacional Autónoma de México (UNAM) through the “Programa de Apoyo a Proyectos de Investigación e Innovación Tecnológica” (PAPIIT), Grant PAPIIT-IV300217.

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Issa Luna-Pla & José R. Nicolás-Carlock

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Both authors conceived the study, participated in the design of it, the analysis of the data, and drafted the manuscript. All authors read and approved the final manuscript.

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Issa Luna-Pla has a PhD in Media Law with relevant experience on anticorruption policy making. José R. Nicolás-Carlock has a PhD in Physics with relevant training on complexity science research. Both authors are leading researchers of the Observatory of Corruption and Impunity, hosted by the Institute of Legal Research at the National Autonomous University of Mexico.

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Luna-Pla, I., Nicolás-Carlock, J.R. Corruption and complexity: a scientific framework for the analysis of corruption networks. Appl Netw Sci 5 , 13 (2020). https://doi.org/10.1007/s41109-020-00258-2

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• Complex systems

Leadership, Power, Corruption in Today’s Politics Research Paper

Introduction, political leadership, the great man theory, political power, the behavioral theory, power and corruption, power and influence theory.

The political leaderships are the most influential positions in society because a person is elected by the constituents to control resources. At the same time, a leader is given the power over subordinates, institutions, economic and social resources, as well as the people. The power is exercised based on the constitution or the country’s legal framework. In many states, a leader is above the law and no one can question their actions through a legal system.

Because of these privileges, political leaders have the discretion to do what they feel is right. Consequently, power might distort their ability to see other people’s perspectives. In the end, they might end up leading a corrupt government because they will only deal with people who support them. According to the Great Man theory, a good leader has biological attributes of leadership. They will exercise good leadership skills irrespective of power and influence.

In terms of the Behavioral theory, a good leader will demonstrate different behaviors in different circumstances. Nevertheless, the power and influence theory posits that power can change a person’s perception and the way they handle resources, subordinates, and subjects. In light of the above three theories, the paper correlates political leadership, power, and corruption.

The concept of leadership, especially in the political arena is complex and the perception of a good leader differs from one school of thought to another. The power and influence that come with political leadership can be possessive to an extent that a leader might lack control and become reckless. According to the Great Man theory, leaders have the genetic attributes with which they are born. It implies that a born leader will always exercise good leadership skills even with much power. Based on the Behavioral theory, a good leader will exhibit desired behaviors and actions through the effective use of power to influence development. It is challenging to control the power that comes with leadership. The ability of an individual to control power and influence determines how well they can lead.

Political leadership and the power it comes with can be deceiving and leaders can engage in immoral and unethical behaviors. In many countries, the sitting president cannot be prosecuted in the law courts. The law gives them the power and discretion to make decisions independently and influence several activities. It is the obligation of the leaders to ensure they follow the rule of the law (Fastovic, 2004). For example, President Nixon engaged in questionable behaviors during Watergate. It could be argued that the president behaved unethically because of the power and discretion he had been given by the constitution. In this context, a leader has the freedom of choice between doing the right things and doing the wrong things (Hellsten & Larbi, 2006).

The idea developed above brings us to the concept of the Great Man theory. In the history of political leadership, great leaders have emerged throughout the world. On the other hand, some rulers have demonstrated poor leadership skills. All leaders have the power to do things the way they are pleased (Northouse, 2016). However, the question that arises is how different leaders leave great legacies, while others fail to provide good leadership.

In his theory of Great Man, Thomas Carlyle argued that the ability of an individual to lead has much to do with genetics (Spector, 2015). It posits that an individual’s genetic attributes determine their ability or inability to make good leaders. The theory can be used to explain why some leaders uphold the constitution and integrity while some violate the very rule of law they should protect.

To support the theory of Great Man, we can give an example of two leaders who work differently under the same conditions. In a democratic state, political leaders are elected by the majority. They are given the power to control resources and make decisions that will have a direct influence on the livelihood of their constituents (Northouse, 2016). One leader upholds the rule of law and makes decisions that influence people’s lives positively.

The leader creates good relations with stakeholders in social, economic, and political sectors locally and internationally. Such a leader leaves a great legacy that will be admired by the successors. Under the same conditions, another leader might use the power to serve personal interests, please the cronies, and neglect the people. They might go as far as using dictatorship and brutality to silence those who oppose their bad regime.

Genetically, people have inherent attributes that are part of them. Through these unique characters, people tend to have different perceptions about things, including leadership skills. While some people might be true to their allegiance, others might be deceitful, corrupt, and brutal. According to the Great Man theory, a leader is born. It implies that leadership depends on the biological attributes, which distinguish a good ruler from the bad one (Spector, 2015).

Some leaders are comfortable when they achieve personal gains. However, others will go to an extreme end in order to ensure that people’s interests are served. For instance, Nelson Mandela served almost three decades in detention because he was determined to free his people from an oppressive rule. After his release, he only served as a president for one term. Such selflessness can only be attributed to the genetic characters of a person and not the leadership skills learned (Northouse, 2016).

Power is one of the most challenging aspects of politics. The main objective of vying for a political position is to gain power and influence over people and resources. Power helps an individual to make connections both locally and internationally. The influence that comes with power presents an opportunity that can be used by the elected leaders to develop or destroy society (Fastovic, 2004). Power gives a person the ability to do bad things and get away with them. According to Bentham (1970), it gives a leader the opportunity to manipulate legal systems, institutions, and resources the way they are pleased. Therefore, power can intoxicate leaders to engage in vices simply because their actions cannot be questioned.

Power has benefits and disadvantages, which leaders must understand. In the leadership realm, confidence and assertiveness are necessary elements one requires to make decisions and give directions. A leader can use the power to delegate duties, allocate resources, and make decisions that would create confidence in people, institutions, and economic partners (Spector, 2015). Such approaches will help the state to move forward and execute their businesses in accordance with the will of people. In other words, they will have used the power to get things done in the right way.

Hellsten and Larbi (2006) argue that power is the only tool a person can use to implement desired goals and objectives. An individual might exhibit good leadership skills and create agendas that will serve the best interests of the people. However, such great ideas remain a dream unless the person is elected to a political position. As a leader, an individual gets the constitutional power to put those great ideas into action.

Therefore, we can say that power is a good tool that can be used to foster the political, economic, and social development of a country. What a potential leader needs are the political power to change the current situation and improve socioeconomic and political conditions.

On the other hand, power can be possessive especially among the egocentric leaders who focus more on their personal desires than they do on people’s demands. Instead of using power as an opportunity for development, they use it to accumulate wealth and stop seeing the importance of other people’s perspectives. Certain leaders are power hungry and they can use it to subjugate the very people who invested the power in them (Gerring & Thacker, 2004). The opportunities and self-satisfaction that come with power when a person ascends a political position are tempting. A few leaders resist the temptations that come with power. That brings us to the question of whether power is a source of corruption or great leadership.

To answer the above question, it is important to highlight the behavioral theory of leadership. How leaders use power depends on the way they do things. The concept focuses on the way leaders behave. It is difficult for a leader to dictate things and expect cooperation. People feel happy when they are involved in leadership processes (Spector, 2015). Inclusive decision-making processes encourage people to accept and support the leader.

For instance, a president who engages members of Congress in important debates is viewed as a democratic leader who is ready to tolerate and accept diverse views. In light of the behavioral theory, the ability of a leader to use power effectively can be discussed in three perspectives. These include autocratic, democratic, and Laissez-faire approaches.

The autocratic approach to leadership occurs when the leader exhibits authoritative behavior towards people. Such leaders tend to make decisions without engaging other leaders. According to Northouse (2016), the model of leadership has both advantages and disadvantages. A leader can use autocracy when there is an urgency to give direction. For instance, a president might be required to deliver a speech when there is a state of emergency. In such situations, there will be no time to make elaborate consultations. Instead, the leader will use personal leadership skills to control the situation. Sometimes, a sharp disagreement might occur among the cabinet ministers. Trying to engage the ministers might not give a successful outcome (Spector, 2015). Under such circumstances, the leader will autocratically use the power to calm the storm.

On the other hand, autocratic leaders might be seen as dictators, especially when they make decisions that require consultations. For instance, negative economic status is one of the conditions that will have a direct effect on all sectors.

A leader cannot develop economies policies to avert inflation without consulting key players in the country’s economic development programs. Based on the importance of internal relations and foreign policies, a president should not deploy military forces to attack another country without a wide consultation (Mackie, 2009). Although the leader has the power to do so, the outcome of such decisions might cause serious problems in the country.

In the context of behavioral theory, the second perspective is the democratic approach to leadership. Democratic leaders allow their subordinates to give input to agendas before they can be implemented (Boswell & Brown, 1999). It is based on the concept of the “majority rule”. Political leaderships involve many players who should work as a team to create strong legal, economic, social, and political institutions and policies. The problem with the democratic style of leadership is that a leader might find it difficult to manage the situation when there are many different perspectives. Although democratic attributes are encouraged throughout the world, it reaches a point when a leader must make a decision without involving others.

The third aspect of leadership behavior that supports behavioral theory is laissez-faire. In this case, leaders do not interfere with the progress made by their subordinates. They allow leaders of various government institutions to make several decisions. Such kind of political leadership is dominant in a democratic state where institutions have independent authorities to make decisions and develop policies that would influence their operations.

The laissez-faire approach works effectively when other leaders have the capacity, are motivated, and can work without supervision (Northouse, 2016). This style of leadership can fail when the top leader is lazy and has the tendency of passing responsibility to junior officers.

The way in which leaders behave determines their performance. It is important to note that neither of the leadership behaviors is good nor bad. However, different situations might need different actions. For instance, a leader might command the military forces to attack a terrorist group based in another country. After the terrorist attack of September 2001, the Bush Administration made a controversial decision to launch a military attack on the Taliban and Al-Qaida in Afghanistan (Jalali, 2006).

The president took an authoritative decision to destroy the terrorist so that he could limit the terrorist threat to the United States. Several local and internal stakeholders criticized the move. However, the president had to make the decision to protect the Americans from possible future attacks. So long as the intent is for the best interest of the majority, the means of executing those actions can be justified.

The connection between power and corruption is a diverse issue that can take both positive and negative perspectives. Political power has been closely related to corruption. Nevertheless, the question that many have been seeking its answer is whether power leads to corruption. It is due to the possibility of some individuals developing the urge for power because they are inherently corrupt (Hellsten & Larbi, 2006). Power gives the leaders more abilities and discretion to act as they are pleased. Some individuals might use political opportunities to deceive people to vote for them as their leaders. Afterward. They can use the opportunity to enrich themselves, oppress their opponents, and downgrade economic advancement that had been made in the past.

Democracy has been promoted across the world as one of the best political ideologies. The main reason is that democracy gives individuals and institutions the freedom to execute their duties without interference (Gerring & Thacker, 2004).

Although it sounds good, too much freedom makes leaders misbehave. Without the controlling aspect, leaders have been using their power to engage in endless misbehaviors. In many instances, political leaders in a democratic environment might use the tyranny of numbers as a tool to engage in unethical and unruly conduct. Corruption in a political realm cannot only be viewed in terms of financial gains achieved by the leaders.

In many countries, leaders have had the tendency to rewarding those who elected them and oppressing those who voted their opponents. Such conducts cause suffering among the people who held different views during political campaigns and elections. The idea of neglecting opponents when a leader has the responsibility to serve everyone irrespective of their perceptions violates the essence of democracy (Chapra, 2003). It is the worst form of corruption in which a leader can engage. Using power as a corruption tool can cause extensive suffering, drift in socioeconomic and political policies, wasted public resources, and inefficient governance.

Corruption goes beyond mere financial gains and rewarding of cronies. It has much to do with the change in personality, self-inflation, and deep moral degeneration. When leaders address the media, what they say, and the way in which they express themselves to determine their intention. Gandhi once said that power possession makes leaders blind and deaf. Corruption triggered by power is caused by the leaders’ inability to see because they have developed a disorder of perception. Before a person holds the power, they may have the same views with others (Gerring & Thacker, 2004). However, they change after gaining power and start doing things in the wrong ways. Unequal status and privileges leaders enjoy making certain things unrealistic or invisible to them.

As a person possesses power, they increasingly develop confidence, diversify their views from local to international relations. They meet different leaders and learn about various aspects of power. As they continue to build their governance systems, they gain more power, and people who surround them cannot contradict their opinions. They become isolated and no one can approach or question their actions (Chapra, 2003). It is dangerous when a person cannot take advice because no one has the ability to always do things right. Leading people involves complex dimensions that require critics, professionals, and other people with leadership experiences. Although the final decisions lie with the current leader, it is always important to listen to others.

When exploring the ways in which power corrupts leaders, the main issues that should be addressed is the manner in which it causes corruption and things that make it happen. Power distorts an individual’s perception because of the privileges and isolations to which they are exposed. The situation promotes four main issues that trigger corruption (Northouse, 2016). The distortion of power results in personal glory, arrogance, and lack of control leading to reckless decisions.

It creates a progressive contempt towards the subjects, suspicion, and cruelty that leads to dictatorship. The leader gradually separates from the rest and select a group of advisors who always agree with selfish ideas. As a result, the leader totally lacks awareness of the ongoing corruption in the country (Mackie, 2009).

The influence of power as the cause of corruption can be explained better using the Power and Influence theory. According to Calhoun (2004), the concept of power and influence take an approach different from the Great Man and Behavioral theories. It is based on the fact that leaders use the power and influence to execute their duties. The manner in which a leader uses the power invested in them determines their ability to uphold integrity or engage in corruption. In the Five Forms of Power by French and Raven, a leadership style based on positional power can take three perspectives. These include legitimate, reward, and coercive leadership, as well as the personal appeals and charisma (Boswell & Brown, 1999).

A leader can use power as a tool to make significant changes in governance. In this context, the changes made can reflect a good or bad leader. When changes are aimed at achieving the good for all, then people will view the leader as a good person. Otherwise, the leader might be termed a corrupt or a dictator (Bentham, 1970). A transactional leader can use the power and influence to perpetuate corruption. In this leadership approach, the elected leaders believe that their subordinates and subjects can only do things to get rewards and nothing else. In terms of economic and social gains, this kind of leadership is not appealing. According to Fastovic (2004), the leader can use public resources to influence others to serve their interests.

Political leadership is the most influential in any given society. Irrespective of the prevailing political ideology, the leadership structure, and organization in the current politics are hierarchical in nature. Although hierarchical leadership might be viewed as a dangerous structure, it has certain advantages. Having someone in a political position to create and execute policies that control resources is inevitable.

We need leaders in political positions to give directions and help in creating mutual, economic, and social relations locally and internationally. The most worrying aspect is the power that comes with political leadership. Based on the Great Man and Behavioral theories, a person who is born a leader will always exhibit good behavior. It does not matter how much power vested in the person. What matters is the attributes and willingness to use public resources and power to make significant changes in the lives of people.

Bentham, J. (1970). An introduction to the principles of morals and legislation . Darien, CT: Hafner.

Boswell, T., & Brown, C. (1999). The scope of general theory- Methods for linking deductive and inductive comparative history. Sociological Methods & Research, 28 (2), 154−185.

Calhoun, L. (2004). The problem of “dirty hands” and corrupt leadership. Independent Review, 8( 3), 363−385.

Chapra, M. (2003). Socioeconomic and political dynamics in Ibn Khaldun’s thought. The American Journal of Islamic Social Sciences, 16 (4), 17−38.

Fastovic, C. (2004). Constitutionalism and presidential prerogative: Jeffersonian and Hamiltonian perspectives. American Journal of Political Science, 48 (3), 429−444.

Gerring, J., & Thacker, C. (2004). Political institutions and corruption: The role of Unitarism and Parliamentarism. British Journal of Political Science, 34 (1), 295−330.

Hellsten, S., & Larbi, A. (2006). Public good or private good? The paradox of public and private ethics in the context of developing countries. Public Administration and Development, 26 (2), 135−145.

Jalali, A. (2006). The future of Afghanistan. Parameters, 36 (1), 4−19.

Mackie, G. (2009). Schumpeter’s leadership democracy. Political Theory, 37 (1), 128-153.

Spector, B. A. (2015). Carlyle, Freud, and the great man theory more fully considered. Leadership, 12 (2), 250-260.

Northouse, P. G. (2016). Leadership: Theory and practice (7 th ed.). Thousand Oaks, CA: SAGE.

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1. IvyPanda . "Leadership, Power, Corruption in Today’s Politics." January 26, 2024. https://ivypanda.com/essays/leadership-power-corruption-in-todays-politics/.

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We need term limits in New York to fight our history of corruption

Former New York State Comptroller Alan Hevesi, left, and former Assembly Speaker Sheldon Silver. Credit: AP / Tim Roske, Charles Eckert

It seems that every time we go to the polls, we’re disappointed by the candidates on the ballot. It’s not just the age of some candidates (see the combined 158 years of the two major-party contenders for president). It’s also about what happens the longer they stay in office, as we have seen with age-related health challenges experienced by such politicians as Sen. Mitch McConnell, the late Sen. Dianne Feinstein, and former President Ronald Reagan.

In New York, we have another concern about longevity in office — elected officials getting “too comfortable.” The longer in office, the more likely it seems bad things will happen — especially when they are virtually guaranteed reelection. This corruption happens because long-serving politicians became too powerful through massive special interest donations and started putting their interests above the will of the voters.

Over the last two decades, New Yorkers have seen not one, but two of their governors and a lieutenant governor leave office amid scandals ranging from corruption to accusations of sexual harassment. We’ve seen a state comptroller convicted of corruption, an attorney general resign over allegations of abuse, and an Assembly speaker along with two State Senate majority leaders (one from Long Island) convicted of corruption. Even though courts may have cleared some of these former lawmakers on appeal, the fact remains that the longer these electeds stay in office the more susceptible and riper they are to putting their wants and needs before the voters.

The way to address this potential for corruption is the way to deal with worries about age-related infirmities — term limits. For New York State officials, three terms of four years each seems right.

This guest essay reflects the views of Timothy Dunn, executive director of Unite NY, a nonprofit, nonpartisan movement focused on engaging and empowering voters on important issues of reform.

New Yorkers may like to call themselves progressive but when it comes to elections, this state has a long way to go. Consider: New York is one of only 13 states without term limits for governor. It’s not that voters don’t want term limits. My organization, Unite NY, polled 800 New Yorkers last year and just 10% said we were ahead of the curve on election reform, while 80% supported term limits for statewide elected officials. There aren't many issues in politics on which 80% of us agree.

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It might sound ironic, but there are elected officials currently in office who support term limits, including Gov. Kathy Hochul. In 2022, Hochul called for term limits for the governor, lieutenant governor, attorney general and comptroller in her 2022 State of the State address.

At the time, she said the plan would “ensure New Yorkers know their leaders work for them.” While that proposal didn’t come to pass, there’s legislation in the Assembly calling for a limit of three terms for all statewide offices. This legislation would trigger a constitutional amendment, meaning it must be approved by two separately elected state legislatures and then by voters. We encourage the Long Island delegation to support this important bill and see it is brought to voters to approve in a public referendum.

While term limits are not a corruption cure-all, they will help. And they do guarantee more choices for more voices. We need more candidates with fresh ideas and new perspectives to run for and serve in office. New York's Constitution was not written envisioning career politicians. Twelve years is plenty of time for any elected official to accomplish their goals in office.

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A Diplomatic Spat in Ecuador May Lift Its President’s Political Fortunes

Analysts believe that President Daniel Noboa’s re-election hopes are what motivated the arrest of an Ecuadorean politician taking refuge at the Mexican Embassy.

By Genevieve Glatsky

Ecuador’s decision to send police officers into the Mexican Embassy to arrest a politician who had taken refuge there inflamed tensions between two countries that were already at odds, but it may prove a political boon for the Ecuadorean president.

President Daniel Noboa has been faced with flagging approval ratings amid rising violence weeks before a referendum that could affect his prospects for re-election next year. The spat with Mexico, which suspended diplomatic relations, may be just what he needed.

The politician who was arrested, Jorge Glas , a former vice president of Ecuador, had been sentenced to prison for corruption and living at the Mexican Embassy in Quito since December. Then on Friday, Mexico granted him asylum, and the Ecuadorean police moved in.

Mr. Noboa’s office said that the arrest had gone forward because Mexico had abused the immunities and privileges granted to the diplomatic mission, but the message it sent was also in keeping line with Mr. Noboa’s hardhanded approach to tackling violence and graft in Ecuador.

The 36-year-old center-right leader came to power in November after President Guillermo Lasso, facing impeachment proceedings over accusations of embezzlement, called for early elections. Mr. Noboa is in office until May 2025, the remainder of Mr. Lasso’s term.

Mr. Noboa’s ability to show that he can restore law and order to the nation of nearly 18 million may prove critical to his re-election, and that means tackling the country’s gangs, as well as corruption within the government that has enabled criminal groups, analysts say.

Many experts say those political aspirations appear to explain the arrest at the embassy, which signaled that the president is tough on impunity.

“He did this to change all these negative talking points that were affecting him and try to have a conversation in his favor,” said an Ecuadorean political analyst, Agustín Burbano de Lara.

Mr. Glas held various ministerial positions during the presidency of Rafael Correa, a leftist, most notably serving as vice president. In 2017, he was forced from office and sentenced to six years in prison for accepting bribes. Another bribery conviction in 2020 implicated him and Mr. Correa, and both were sentenced to eight years.

Released in 2022, Mr. Glas eventually sought asylum in Mexico, a move that strained relations between Ecuador and Mexico. Ecuador’s Foreign Ministry said in March that it had requested Mexico’s permission to arrest Mr. Glas.

While Mr. Noboa is very popular, polls show that his approval rating fell 11 points in recent months, from 85 percent to 74 percent, amid the rising violence in Ecuador.

After the coastal city of Guayaquil was overrun by gang violence in January, Mr. Noboa declared an internal conflict , an extraordinary step taken when the state has come under attack by an armed group. He deployed the country’s military, allowing soldiers to patrol the streets and prisons to tackle the soaring gang violence linked to drug trafficking.

The aggressive response initially reduced violence and brought a precarious sense of safety to places like Guayaquil — but the stability did not last. Over the Easter holiday, there were 137 murders in Ecuador, and kidnappings and extortion have worsened .

In two weeks, Ecuadoreans will vote on a referendum to allow the government to increase security measures by making prison sentences for some crimes more severe and enshrining the increased military presence into law.

Experts say it is too soon to say if the arrest of Mr. Glas will benefit Mr. Noboa at the ballot box, but several Ecuadoreans said on Sunday that they supported the action.

“Mexico has treated Ecuadoreans like fools, giving asylum to all these convicted people,” said Danilo Álvarez, a 41-year-old salesman from Guayaquil, one of the country’s most violent cities.

Ecuador itself once famously granted asylum and protection at one of its embassies. In 2012, when Mr. Correa was president, it did so for the founder of WikiLeaks, Julian Assange , housing him at its embassy in London for seven years.

Mr. Álvarez said that robbers had broken into his house a few years ago, tied his hands and feet together and held a gun to his head. It was months before he was able to sleep well again, he said.

Not all citizens, however, were in agreement with the arrest.

“This was an act of total disrespect for international law,” said Delfa Mantilla, 62, a retired teacher. “It seems that it was something that President Noboa did as a product of his rich-boy ego, without empathy.”

Some worried about the affects that the diplomatic dispute could have for ordinary people. Tens of thousands of Ecuadoreans migrate through Mexico to the United States every year, and the two countries have faced a surge in transnational crime, with many Mexican cartels operating out of Ecuador.

“Part of me thinks it’s fine, because Glas should go to jail,” said Mario Zalamar, a 34-year-old commercial engineer. But, he said, “There are thousands of Ecuadoreans right now moving through Mexico on foot to migrate to the United States, and we don’t know how much this is going to affect them.”

Even if many Ecuadoreans support the arrest at the embassy, Mr. Noboa has likely deepened a diplomatic rift that may weaken its relations with other countries in the region.

Honduras, Brazil, Colombia and Argentina have all rallied around Mexico and criticized the arrest. And the government of Nicaragua announced it was suspending its diplomatic relationship with Ecuador, characterizing the arrest as “neo-fascist political barbarity” in a statement shared by state-run media .

Matthew Miller, a spokesman for the American State Department, said, “The United States condemns any violation of the Vienna Convention on Diplomatic Relations, and takes very seriously the obligation of host countries under international law to respect the inviolability of diplomatic missions.”

Mr. Miller called on both countries to resolve their difference.

José María León Cabrera and Thalíe Ponce contributed reporting.

Former Atlanta chief financial officer pleads guilty to stealing money from city for trips and guns

ATLANTA — The former chief financial officer for Atlanta pleaded guilty on Monday to stealing money from the city for personal travel and guns and trying to cheat the federal government on his income taxes.

Jim Beard , 60, pleaded guilty to one count of federal program theft and one count of tax obstruction in federal court in Atlanta.

U.S. District Judge Steve Jones is scheduled to sentence Beard on July 12. Beard could face as many as 13 years in prison but is likely to be sentenced to substantially less under federal guidelines.

Beard served as the city’s chief financial officer under Mayor Kasim Reed, managing Atlanta’s financial resources from 2011 to 2018. Beard is the 10th person to be convicted in an anti-corruption probe into Reed’s administration. Most of the others were convicted on charges of giving or taking bribes for city contracts. Reed himself has never been charged.

During his time in office, Beard used city money to pay for personal trips and to illegally buy two machine guns for himself, he admitted in his plea agreement.

Federal prosecutors said Beard stole tens of thousands of dollars from the city, although the plea outlined about $5,500 in thefts.

That includes spending over $1,200 for his stepdaughter to spend three nights in a Chicago hotel room during an August 2015 music festival. Beard said he was there to discuss interest rates on city debt.

Beard also admitted to buying two custom-made machine guns from Georgia manufacturer Daniel Defense in 2015, paying $2,641.90 with a city check. Beard had claimed the guns were for the Atlanta Police Department — it’s generally illegal for civilians to possess machine guns in the United States — but he kept them until he left them in 2017 at the police department office overseeing the mayor’s protection.

He also spent $648 on airfare to New Orleans to attend the New Orleans Jazz and Heritage Festival in April 2016, later deducting the same expense from his income taxes by telling the IRS it was for his personal consulting business. Beard also double-dipped by charging the city nearly $1,000 in travel expenses to a New York meeting with a bond regulatory agency and then getting the same agency to reimburse him $1,276.52.

Beard also claimed $33,000 in losses from his consulting business on his 2013 income tax return, with the IRS ultimately allowing him to deduct $12,000 in business travel expenses he never spent.

Under the plea, Beard is giving up his claim to the guns and is agreeing to pay back various entities including the city of Atlanta.

100 years ago, a former Oklahoman exposed nation’s biggest political scandal. But that wasn't his greatest claim to fame

A century ago this spring, the Teapot Dome affair boiled over. A former Oklahoman had lit the flame.

The man was Carl Magee, and his exposure of the corruption scandal — the biggest in the nation’s history up to that point — wasn’t even his greatest claim to fame.

That came years later in Oklahoma City, when he invented and deployed the world’s first parking meters.

Magee’s remarkable story prompted The Oklahoman to declare upon his death that he had “crowded the experiences of several lifetimes into his 73 years.”

Indeed he had.

Born in Iowa, where he was a school superintendent at age 23, Magee relocated to Indian Territory in 1904 to start a career as a lawyer.

He found success in Tulsa during its oil boom, dabbling in business and politics, and making his mark as a civic booster and justice crusader.

Concerned about corruption in the boomtown, he headed a citizens group that instigated the indictment of the mayor and police chief. He also was a leader in the push to build the Spavinaw water project, which supplies Tulsa to this day.

Magee’s wife, Grace, developed tuberculosis, so the family moved to the high, dry climate of New Mexico, where he pursued a lifelong dream of publishing a “truth-telling” newspaper.

He bought the Albuquerque Journal and began attacking that state’s widespread corruption. That threw him into conflict with Albert Fall, the U.S. senator who ran the Republican political machine.

Their feud continued after Fall became U.S. secretary of the interior.

In that role, he took control of the vast oil fields that the federal government had set aside as emergency stockpiles for the U.S. Navy. He then cut no-bid deals with two oil tycoons ― Harry Sinclair and Edward Doheny — giving them exclusive rights to drill in the Teapot Dome and Elk Hills reserves.

Magee was deeply suspicious. He had long known Sinclair, who first struck it rich in Oklahoma, and had heard rumors that Fall was suddenly flush with cash.

As the Journal raised questions about the arrangements, Fall lashed out, forcing Magee to sell the newspaper. The editor responded by launching a new paper, which would evolve into the Pulitzer Prize-winning Albuquerque Tribune.

Eventually, Magee was called to Washington to testify about Fall’s newfound wealth. His appearances before a Senate committee in 1923 and 1924 turned a humdrum political controversy into a scandal that rocked America.

Investigators uncovered about $400,000 in payments the oil millionaires made to the interior secretary, equivalent to about $6.5 million today, and Fall was convicted of receiving a bribe.

He was the first Cabinet secretary to be sent to prison — and the last until former Attorney General John Mitchell was convicted in the Watergate probe.

Teapot Dome wasn’t the end of Carl Magee’s story, though. Far from it.

More: COLUMN: How an Oklahoma cop invented the 'Yield' traffic sign

In New Mexico, an irate Republican judge tried him on trumped-up charges of libel and contempt. Magee escaped imprisonment thanks only to a gubernatorial pardon.

Later, that same judge encountered Magee in a hotel lobby and attacked him with fists and feet. Sprawled on the floor, the editor grabbed a gun and shot his assailant in the arm. But the gunfire also killed a bystander who tried to help. Magee was charged with manslaughter but acquitted.

Drawn to the editor’s plight, the Scripps-Howard newspaper group invested in Magee’s new newspaper, giving him financial stability while retaining him as editor. Later, the company moved him to Oklahoma City, where its struggling Oklahoma News needed “jazzing up.”

Back in the Sooner State, Magee continued his muckraking ways, accusing state senators of bribery during the debate over the impeachment of Gov. Henry S. Johnston.

Magee also went to war against Chief Justice Fred Branson, who was voted out of office, and millionaire developer John J. Harden, who brought a $250,000 libel suit against the editor but later dropped it.

When the Oklahoma City oil field was discovered, Magee’s front-page columns helped the city navigate the bonanza. He argued, among other things, to preserve the Oklahoma Natural Gas franchise and not build a municipal gas utility.

Eventually, Magee parted ways with Scripps-Howard over how to compete with The Oklahoman during the Great Depression.

But the versatile editor already had another gig in the works.

In 1932, the Chamber of Commerce had asked him to chair a committee trying to find a solution to downtown parking congestion.

More: Oklahoma City inventor of shopping cart a symbol of local innovation

The editor had an idea. Why not build a device that could rent parking spaces to motorists for limited visits?

Magee built a crude model and patented the parking meter on Dec. 21, 1932.

Two Oklahoma A&M professors — H.G. Thuesen and Gerald Hale — then created a working prototype, and on July 16, 1935, the world’s first parking meters were installed in Oklahoma City.

Magee’s Park-O-Meters soon spread throughout the United States.

Grace Magee died in 1936, and Carl Magee briefly left Oklahoma City for a newspaper venture in South Texas. But he returned to the city he loved in 1939 and dedicated the rest of his life to volunteerism.

During World War II, he headed Oklahoma’s War Chest drive, raising millions of dollars for the USO, Red Cross and similar causes. He chaired a committee studying the merger of the city’s two oldest Methodist churches, and he led a citizens group that won higher wages for teachers.

Carl Magee died in Oklahoma City on Jan. 31, 1946.

“He was a crusader and he never shrank from a fight,” wrote The Oklahoman, against whom he had vigorously competed. “He was a stalwart man of the great plains and long horizons, and his name will always be remembered with gratitude and admiration.”

Jack McElroy is a retired journalist. His biography of Carl Magee, "Citizen Carl: The Editor Who Cracked Teapot Dome, Shot a Judge and Invented the Parking Meter," was published recently by the University of New Mexico Press.

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Lebanon’s billionaire prime minister denies allegations of money laundering in France

FILE - Lebanese caretaker Prime Minister Najib Mikati speaks during a conference announcing a French reconstruction plan for the Beirut Port, in Beirut, Lebanon, Wednesday, March 13, 2024. Mikati has denied all allegations of money laundering after a complaint was filed in France by two anti-corruption groups this week. The complaint against Najib Mikati was formally filed Tuesday, April 2, 2024, to France’s National Financial Prosecutor’s office by French anti-corruption non-governmental organization Sherpa and the Collective of Victims of Fraudulent and Criminal Practices. (AP Photo/Bilal Hussein, File)

FILE-The Paris courthouse is pictured Monday, July 12, 2021 in Paris. Lebanon’s billionaire caretaker prime minister has denied all allegations of money laundering after a complaint was filed in France by two anti-corruption groups this week. The complaint against Najib Mikati was formally filed Tuesday to France’s National Financial Prosecutor’s office by French anti-corruption non-governmental organization Sherpa and the Collective of Victims of Fraudulent and Criminal Practices. (AP Photo/Lewis Joly, File)

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PARIS (AP) — Lebanon’s billionaire caretaker prime minister has denied allegations of money laundering after a complaint was filed in France by two anti-corruption groups this week.

The complaint against Najib Mikati was formally filed Tuesday with France’s National Financial Prosecutor’s office by French anti-corruption non-governmental organization Sherpa and the Collective of Victims of Fraudulent and Criminal Practices.

Sherpa said the objective is to “shed light on the conditions under which Lebanese political figures like Najib Mikati accumulated considerable wealth and on the role of financial intermediaries who facilitated these acquisitions.”

No details were immediately available about the sums of money allegedly involved.

The group said it drew the attention of French prosecutors to the conditions under which Mikati “has accumulated significant assets in France. The complaint also questions the origin of the funds that transited through the French banking system.”

Mikati said in a statement published Wednesday by Lebanon’s state-run National News Agency that he and members of his family have always acted in accordance with the law. He defended the family’s “integrity” and said its business is characterized by “complete transparency.”

French prosecutors have yet to decide whether to launch an investigation.

One of the richest men in Lebanon, Mikati, 68, has served as prime minister since 2021 .

He founded the telecommunications company Investcom with his brother Taha in the 1980s and sold it in 2006 to South Africa’s MTN Group for $5.5 billion.

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Mexico's president says country will break diplomatic ties with Ecuador

Updated on: April 6, 2024 / 4:27 PM EDT / CBS/AP

QUITO, ECUADOR - The Mexican president has quickly moved to break off diplomatic ties with Ecuador after police broke into the Mexican Embassy to arrest a former vice president who had sought political asylum there after being indicted on corruption charges.

In an extraordinarily unusual move, Ecuadorian police forced their way into the embassy in the capital, Quito, to arrest Jorge Glas, who had been residing there since December. Police broke through the external doors of the Mexican diplomatic headquarters in the Ecuadorian capital and entered the main patio to get Glas.

On Saturday, he was taken from the attorney general's office to a detention facility in an armored vehicle followed by a convoy of military and police vehicles. People who had gathered outside the prosecutor's office yelled "strength" as the vehicles began to move.

The raid prompted Mexico's President Andrés Manuel López Obrador to announce the break of diplomatic relations with Ecuador Friday evening.

Venezuela issued a statement on Saturday supporting Mexico, condemning Ecuador, and said "we urge the international community to take measures against these reprehensible acts that threaten the integrity and full stability of Latin America as a zone of peace."

Glas has been convicted on bribery and corruption charges. Ecuadorian authorities are still investigating more allegations against him.

"This is not possible. It cannot be. This is crazy," Roberto Canseco, head of the Mexican consular section in Quito, told local press while standing outside the embassy. "I am very worried because they could kill him. There is no basis to do this. This is totally outside the norm."

Defending its decision, Ecuador's presidency said in a statement: "Ecuador is a sovereign nation and we are not going to allow any criminal to stay free."

López Obrador fired back, calling Glas' detention an "authoritarian act" and "a flagrant violation of international law and the sovereignty of Mexico."

Alicia Bárcena, Mexico's secretary of foreign relations, posted on the social platform X that a number of diplomats suffered injuries during the break-in, adding that it violated the Vienna Convention on Diplomatic Relations. She also said on Saturday that embassy staff left Ecuador  and returned to Mexico on commercial flights.

Diplomatic premises are considered "inviolable" under the Vienna treaties and local law enforcement agencies are not allowed to enter without the permission of the ambassador. WikiLeaks founder Julian Assange lived inside the Ecuadorian Embassy in London for seven years because British police could not enter to arrest him.

Bárcena said that Mexico would take the case to the International Court of Justice "to denounce Ecuador's responsibility for violations of international law." She also said Mexican diplomats were only waiting for the Ecuadorian government to offer the necessary guarantees for their return home.

Ecuador's Foreign Ministry and Ecuador's Ministry of the Interior did not immediately respond to a request for comment.

The Mexican Embassy in Quito remained under heavy police guard late Friday.

A day earlier, tensions between the two countries escalated after Mexico's president made statements that Ecuador considered "very unfortunate" about last year's election, won by Ecuadorian President Daniel Noboa.

In reaction, the Ecuadorian government declared the Mexican ambassador persona non grata.

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