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context (or more generally, cultural ideas) helps form officials’ preferences. These are
set through a combination of self-interest—as informed by institutional incentives—and
social identities/norms. Social norms, like particularism, create more predictable social
outcomes of actors helping their ‘in-group’ before their ‘out-group.’ Therefore, informal
societal norms derived from specific cultures also play a role in helping to set actor
preferences, sometimes in conflict with the incentives structured by institutions.
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Although China and Indonesia are similar in that informal norms set corrupt preferences,
there is variance in the level of official capacity for rent seizing. In China the politburo
(the highest level of authority) is seeking to regain control over fairly autonomous
localities and is especially interested in reducing corruption at all levels of government.
However, institutional solutions have not been successful and the perceptions of
corruption have increased. In Indonesia post-Suharto, the local governments are gaining
more power vis-à-vis the central government. This process of power devolution has
created the space for rent seizing by officials at all levels, and officials’ capabilities are
now in line with their interests which have been set by a system of patronage politics and
kinship ties. In response to increasing levels of corruption, the subsequent Presidents
have undertaken anti-corruption legislation. However, the types of legislation and the
enforcement mechanisms are clearly not designed to be too effective.
This comparison illustrates the importance of combining effective institutional change
with an understanding of how informal norms set officials’ preferences. By highlighting
the deficiencies of the dominant institutional account, I am able to identify possible
solutions to this puzzle that might be more effective.
Policy Implications
Two policies that might prove more effective at curbing corruption are making
institutional change exogenous to current officials, especially those at the local level, and
altering social identities. If anti-corruption bodies like the judiciary (or CCDI in China)
were independent from the government at all levels and possessed the power and
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North.
Convention