Corruption in Russia’s Primorsky Kray: is transparency the answer?
| DOI | https://doi.org/10.1108/JFC-02-2018-0017 |
| Published date | 07 January 2019 |
| Pages | 382-395 |
| Date | 07 January 2019 |
| Author | Matthew Benjamin Levie |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
Corruption in Russia’s Primorsky
Kray: is transparency the answer?
Matthew Benjamin Levie
Middlebury Institute of International Studies at Monterey,
Monterey, California, USA
Abstract
Purpose –The purpose of this paper is to use open-source Russian government data to investigate the
relationship betweentransparency and corruption. Russia is a developed countrywith a strong legal system
and world-classtransparency in government contracting, which accordingto many, should positively impact
corruption.This study tests that hypothesis.
Design/methodology/approach –The paper statistically analyzes six months’worth of Russian
governmentcontracts from a single Russian province and another month of data from a different provincefor
comparison. The statistical analysisrevealed individual instances of corruption, which were then analyzed
qualitatively.
Findings –The paper found that competitiveness in Russian governmentcontracting is extremely limited,
and instancesof corruption on a grand scale are easy to find in publicly available data.
Research limitations/implications –The paper only studied data from two Russian provinces, so
readers shouldbe careful about generalizing from the results. Further researchshould consider similar data, if
obtainable,from other countries.
Practical implications –Countriesseeking to limit corruption should consider cultural change, as well as
modificationsto government processes and legal systems.
Originality/value –The paper indicates that soundand transparent legal structures, by themselves, may
be insufficientto prevent or discourage corruption.
Keywords Russia, Transparency, Corruption, Procurement, Democracy
Paper type Research paper
Introduction: why study corruption in Russia?
It is a truism that corruption is an extremely damaging phenomenon; it wastes
taxpayer money, promotes inefficiency in the private sector and undermines trust in
government. One of the greatest loci for corrupt activities is the government
procurement process, which accounts for a large percentage of government spending.
The theoretical literature approaches corruption in three fundamentally different ways:
economic, cultural and legal.
In the economic view, corruption is “caused”by either underdevelopment or
inequality. Some scholars have performed multivariate regression analyses using
Transparency International’s Corruption Perception Index (CPI) as a dependent
variable and concluded that GDP per capita, which correlates inversely with the CPI,
is its best predictor (Treisman, 2000;Paldam, 2002). In contrast, You and Khagram
(2005) aggregated economic and corruption data over many years and found that
inequality and not GDP was the significant factor and argued that inequality leads to
a situation in which the numerous poor must resort to corruption to secure basic
services, and this in turn reveals government to be a tool of the rich, and therefore
inherently unjust –and cheating an illegitimate system is itself less likely to be
JFC
26,1
382
Journalof Financial Crime
Vol.26 No. 1, 2019
pp. 382-395
© Emerald Publishing Limited
1359-0790
DOI 10.1108/JFC-02-2018-0017
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