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SUDHIR KRISHNASWAMY
FINAL SUBMISSION

Dr Sudhir Krishnaswamy is Professor of Law, West Bengal National University of ­Juridical Sciences

Differentiate between bribe givers and takers

Sadhus hold placards in support of Anna Hazare who was staging a fast for the Jan Lokpal Bill, a strong anti-corruption law, in Allahabad on 7 April. PTI

t is now open season on corruption in India. The accusers and accused hurriedly exchange places in a game of musical chairs. Recorded phone conversations ostensibly establish the ubiquity of corruption. There is no time or patience for institutional protocols to establish the truth and accuracy of these allegations or the integrity of those who make them. In this din, there is little clarity on the usage of the term "corruption" or the appropriate means to tackle it.

Kaushik Basu has joined this debate in an academic and provocative paper titled "Why for a class of bribes, the Act of Giving a bribe should be treated as legal." This paper is presented as the first in a series of Working Papers on topics of strategic economic policy produced by the Economic Division of the Department of Economic Affairs, Ministry of Finance.

This working paper series seeks to provide a forum to give shape to new ideas by discussion, debate and dissemination. Given the general lack of serious intellectual engagement with policy issues such as "corruption" in India, this is an important initiative.

This short paper argues that for a category of bribes called "harassment bribes" the bribe giver should have full immunity from any punitive action by the state. Using a game theory model, it is suggested that such reform will deliberately misalign the incentives of the bribe giver and the bribe taker, leading to the increased detection of bribery. It concludes that the increased detection of bribery will mould the behaviour of the bribe taker to desist from taking bribes, and the overall decline of this form of corruption.

In this column I argue that this proposal deserves rigorous scrutiny on its own terms to uncover and overcome methodological problems that undermine its claims. I will focus on two such problems: first, the distinction between harassment and non-harassment cases and secondly, the configuration of bribery as a two-player game theoretical model. I will examine each in turn.

The paper limits the enquiry into only one form of corruption, namely bribery. Further, it distinguishes between two forms of bribes. Harassment bribes are those which people have to pay to secure services or permissions they are otherwise legally entitled to. Non-harassment bribes are all other types of bribes. The distinction rests on our ability to distinguish cases where legal entitlements are determinate and certain from those cases where they are not. Often, it is the capacity of the state agent to utilise the armoury of rules to deny legal entitlements that makes a majority of bribes "non harassment" bribes. The purpose of the proposed legislative distinction between harassment and non-harassment bribes is to grant immunity only to bribe givers who are legally blameless, but it may not be possible to make this determination in a non-judicial manner. Hence, the proposal must be modified to survive this legal hurdle.

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The purpose of the proposed legislative distinction between harassment and non-harassment bribes is to grant immunity only to bribe givers who are legally blameless

The paper rests on a game theory model which understands bribery as a two-player game: the bribe giver and the bribe taker. It posits that when the two players' incentives are deliberately misaligned then the outcomes in such a legal context will change substantially.

This model seems to be inadequate in two respects: first, in most non-harassment bribe contexts the professional service provider, agent or the tout acts as an interface between the bribe giver and the bribe taker. Secondly, for this model to work the enforcement agencies' incentives need to be aligned with those of the law. A player in a game theory model is a person who makes a choice or who receives a payoff from the outcome of the choices of the players. In a bribery game, we need to account for the agent and the enforcement agency in order to have a richer predictive model that serves as the basis of law reform.

The paper develops on a legal analysis of the weaknesses of the Prevention of Corruption Act, 1988. The proposed model partially resembles a distinction used in the Lokayukta Acts in various states such as Karnataka between the "raid" and the "trap." The raid is where the Lokayukta acts on its own initiative to survey search and seize the assets of a corrupt government bureaucrat. The trap refers to those cases where the bribe giver co-operates with the Lokayukta to catch the bribe taker red handed. At the Azim Premji University we are undertaking a comprehensive quantitative study of raid and trap cases launched by the Karnataka Lokayukta over the last 15 years. The early analysis of the data suggests that provision for trap cases does not lead to higher rates of conviction or a sharper fall in bribery in the concerned departments.

his paper published by the Finance Ministry invites greater analytical rigour and clarity in corruption talk in India. By framing the debate in novel ways we will develop the capacity to respond to complex problems in a nuanced fashion. Glib assumptions that rest on moral platitudes plague our public discourse on corruption. Any effort to move away from this must be welcome.

 
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