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Do democracy and press freedom reduce corruption?

SHYAMAL CHOWDHuRY
ARE democratic societies less corrupt than non-democratic societies? Does a free press play any role in combating corruption? The purpose of this writing is to explore these two questions briefly by examining the link among democracy, press freedom and corruption.
After the fall of communism and other forms of dictatorship, democracy now is the paramount form of political organisation. Similarly, and uncensored press, free from day to day government intervention, constitutes a pre-eminent component of a democratic society. A democratic government has political incentives to take timely action against corruption. The primary role of a free press comes from information dissemination; by spreading the state of corruption and misdeeds committed by public officials, bureaucrats and elected politicians, a free press can reduce the information asymmetries that otherwise prevail between voters and elected politicians. In addition, a free press can directly influence public policies by criticising public misdeeds and corruption.
In fact, a functioning democracy and an uncensored press can complement and reinforce each other in combating corruption. While an uncensored press can bring information about corruption to the forefront, a functioning democracy can create incentives for the voters to protest against corruption and for the gov-
ernment to act against corruption. Whether a government takes action against corruption depends on whether the citizens exert pressure by making use of their political rights -- criticising, protesting and voting. However, in a functioning democracy with opposition parties, the government has immediate incentives to combat corruption. In contrast, in the absence of criticism from a free press and a pressure from the opposition, corruption can result from the political immunity enjoyed by government leaders in authoritarian countries.
There is a strong association between press freedom and corruption. Countries with a high level of press freedom generally have a low level of corruption. For instance, Switzerland with the highest level of press freedom enjoys one of the lowest level of corruption. As opposed to Switzerland, Angola with a very low level of press freedom has a very high level of corruption. Again, the position of Bangladesh is an exception. However, unlike democracy where Bangladesh ranks relatively high among poor countries, it ranks almost at the bottom in case of press freedom. Therefore, the very high level of corruption is not an unlikely outcome.
The simple associations suggest that political competition in a democratic society and a free press play an important role in reducing corruption. While a free press reduces imperfect information about policy outcomes and informs the voters, political com-
petition in a democratic society ensures that voters' preferences are reflected in policy.
Now the interesting question would be to put corruption against democracy and press freedom together. According to our theoretical reasoning discussed above, it was obvious that democracy and press freedom complement each other. Therefore, we need to go beyond the simple associations shown in two figures above. In fact, recent empirical literature that looks at this issue finds that this is the case. Countries with a high level of democracy and a high level of press freedom have a lower level of corruption compared to countries that have either one of those.
This finding has important policy implications. Development communities and donor agencies need to put more emphasis on democratic practices and on press freedom. Since promotion of democracy and press freedom can expose autocratic corrupt governments to scrutiny, autocratic regimes would not adopt such practices on their own. Therefore, donor communities and development agencies can add democracy and press freedom as aid and development assistance conditionally, which may force such regimes to reduce corruption.
Though democracy and press freedom are effective instruments to combat corruption, there may be a substantial time lag. As we see in the case of Bangladesh, despite the restoration of democratic process in the
early 90s, the country remains highly corrupt according to TI's corruption perception index. However, we have neither the counterfactuals nor the quantitative measures of the extent of corruption under the autocratic regimes that the country undergone during the late 70s and 80s. Therefore, whether a shift from autocracy to democracy with an accompanied increase in press freedom have resulted in a reduction in corruption is difficult to answer.
It is needless to say that democracy does not work 'as an automatic remedy' to all ills, as Sen (1999, p.155-156) warned. It rather creates an opportunity, but "with what strength such opportunities are seized depends on a variety of factors, including the vigour of multiparty politics " Though our evidence suggests that democracy creates incentives for reducing the level of corruption, there are democratic countries with a high rate of corruption. For these countries, explanations need to go beyond tautologies such as 'interest groups that benefit from corruption are more powerful than the voters' and we need to find the sources of the power of such interest groups in democratic societies.
Shyamal Chowdhury is currently a postdoctoral fellow at International Food Policy Research Institute (IFPRI), Washington, DC .