“Who to punish” published on May 5th, 2011 in The Economist discusses a recent policy proposal by Kaushik Basu, an economic advisor to India’s Finance Ministry. Basu’s proposal suggests exonerating “bribe-givers” of a crime when demanded to pay “harassment bribes,” bribes for public services they are entitled to. Basu’s policy would then entitle bribe-givers to go to court and re-coup their money. He argues that corruption will therefore decrease because people will be more likely to report bribery without fear prosecution.
Basu’s policy has the obvious flaw of condoning corruption, leading to potential increases in bribery by causing previous non-bribe-givers to give bribes. Nevertheless, it might also successfully combat corruption. Considering the widespread corruption in India, I therefore support his policy, but only in conjunction with other policies. The three policy recommendations I propose and elaborate upon below include: increasing pay for public officials, drastically improving the court system, and raising taxes.
In addition to legalizing bribe-giving, it is necessary to also increase thee salaries of public workers. Government workers demand bribes because they earn such poor salaries. Further reducing their income by impeding bribes, will therefore do little to get rid of their incentive to demand bribes in the first place.
My second policy recommendation, that the court system must be made cheap, quick and efficient for citizens, will remove any opportunity cost for citizens who go to court to file a claim against a bribe-recipient. This is necessary, because if it doesn’t occur the entire point of not paying a bribe or paying it in hopes of being reimbursed later, will be undermined. Implementing and enforcing such a policy will be extra challenging, however, considering that the courts will at the same time be confronted with an increase in cases, resulting from the people filing complaints against bribe-recipients. In addition, the entire policy might backfire if the court employees view this as an opportunity to supplement their own salaries by demanding even more bribes for themselves.
Raising taxes to pay for the salary increase of public officials, the restructuring of the court system, and the marketing campaign informing the Indian people of their rights and educating them on what constitutes a harassment bribe is necessary. If the cocktail of anti-corruption policies is effective, the tax effect on people’s pocketbooks might even be zero, as the money citizens would have paid for bribes would instead be used for taxes. It would have the benefit, however, of increasing government program efficiency, and decreasing deep-seated frustration and government mistrust.
In conclusion, in addition to recommending Basu’s policy in combination with the above three policies, I also recommend randomizing the combination and implementation of these policies across states. This will enable the government to best determine what policy strategy would be most effective. This is especially important considering the potentially dangerous flaw of Basu’s policy I identified above.

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