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Authors: Reddy, Karthik
Schularick, Moritz
Skreta, Vasiliki
Keywords: accountability, corruption, immunity, interest groups
Issue Date: 2-Oct-2012
Abstract: Statutory immunity provisions that limit the criminal liability of politicians 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. In this paper we quantify the strength of immunity protection in 74 democracies and verify that the strength of immunity is strongly associated with corruption on an aggregate level. To our knowledge, this represents the first systematic attempt to code the strength of immunity protection for politicians and test its impact on corruption. We show both theoretically and empirically that immunity provisions add an important new dimension to the study of accountability and corruption. The incidence of corruption soars when politicians are placed above the law. This key empirical finding echoes, among others, the relationship between diplomatic immunity and parking violations, as uncovered by Fisman and Miguel (2007). Our study also parallels recent work on political protection for tax evasion in Southern Europe such as Artavanis et al. (2012).
Rights: Copyright Reddy, Schularick, and Skreta, 2012.
Appears in Collections:Economics Working Papers

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