Corruption soars when politicians are placed above the law, study finds

In a new study, Stern School of Business assistant professor of economics Vasiliki Skreta and co-authors, Karthik Reddy of Harvard Law School and Moritz Schularick of the University of Bonn, examine statutory immunity provisions that obstruct or limit the criminal liability of politicians, and which exist throughout much of the modern democratic world.

Though anecdotal evidence suggests that immunity promotes corruption, neither the political economy literature on accountability nor the empirical literature on the determinants of corruption has devoted attention to the immunity of politicians. A likely reason for this omission is the dearth of available data. This paper represents the first systematic attempt to quantify the strength of immunity protection for politicians and to test its impact on corruption. In the study, posted on the Social Science Research Network, researchers showed both theoretically and empirically that immunity provisions add an important new dimension to the study of accountability and corruption, and that the incidence of corruption soars when politicians are placed above the law.

The researchers quantified the strength of immunity protection in 74 democracies and verified that immunity is strongly associated with corruption on an aggregate level. They also developed a theoretical model that demonstrated how stronger immunity protection can lead to higher corruption. The model suggested that unaccountable politicians under immunity protection can enhance their chance of re-election by using illegal means, namely supporting interest groups through lax law enforcement, non-collection of taxes, and other forms of favoritism that will go unpunished. Interest groups can then, in turn, provide favorable propaganda, campaign financing, and even vote-buying. Furthermore, the researchers' theoretical model suggested that higher levels of immunity protection also contribute to poor governance because stronger immunity attracts dishonest people to public office.