NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Why Some Diplomats Park Illegally

"There is a strong correlation between illegal parking and existing measures of home country corruption. Even when stationed thousands of miles away, diplomats behave in a manner highly reminiscent of officials in the home country."

The underlying causes of corruption remain poorly understood and widely debated. There is little firm evidence relating corruption to real-world causal factors. While social norms are often mentioned as a primary contributor to corruption in both the academic literature and the popular press, there is no evidence beyond casual cross-country studies.

In Cultures of Corruption: Evidence From Diplomatic Parking Tickets (NBER Working Paper No. 12312), authors Raymond Fisman and Edward Miguel develop an approach to evaluating the role of social norms in corruption by studying parking violations among international diplomats living in New York City. Approximately 1700 consular personnel and their families from 146 countries benefit from diplomatic immunity, a privilege that allowed them to avoid paying parking fines prior to November 2002. The authors examine differences in the behavior of government employees from different countries, all living and working in the same city, and all of whom can act with impunity in illegally parking their cars.

The act of parking illegally fits well with a standard definition of corruption, that is, "the abuse of entrusted power for private gain." That definition suggests that the comparison of parking violations by diplomats from different societies serves as a plausible measure of the extent of corruption social norms or a corruption "culture."

The authors point out that their chosen setting has a number of advantages. Most importantly, their approach avoids the problem of differential legal enforcement levels across countries, and more generally strips out enforcement effects, since there was essentially no enforcement of parking violations for diplomats during the main study period. They therefore interpret diplomats' behavior as reflecting their underlying propensity to break rules for private gain when enforcement is not a consideration. Additionally, because U.N. diplomats are largely co-located in midtown Manhattan, the study avoids concerns of unobserved differences in parking availability across geographic settings.

The authors find that there is a strong correlation between illegal parking and existing measures of home country corruption. This finding suggests that cultural or social norms related to corruption are quite persistent: even when stationed thousands of miles away, diplomats behave in a manner highly reminiscent of officials in the home country. Norms related to corruption are apparently deeply engrained, and factors other than legal enforcement are important determinants of corruption behavior.

The authors' parking violation measure of corruption is strongly positively correlated with other country corruption measures. Further, this relationship holds regardless of home region, country income, and a wide range of other controls, including measures of government employees' salaries. This finding arguably validates the usefulness of the new measure. But, it also goes against the predictions of standard economic models of crime in situations of zero legal enforcement. Those models would predict that parking violations should be high across the board for all diplomats when enforcement is lifted. Instead, the authors find that diplomats from low corruption countries (for example, Norway) behave remarkably well even in situations where they can get away with violations, while those from high corruption countries (for example, Nigeria) commit many violations, suggesting that they bring the social norms or corruption culture of their home country with them to New York City.

A second, related finding is the strong negative relationship between affinity for the United States in the diplomat's home country and parking violations in New York. This finding provides real world evidence that sentiments matter in economic decision making in general, and for

corruption decisions in particular. One implication of this finding is that government officials' "feelings" towards their own nation - for instance, their extent of patriotism, national pride, or strength of national identity - could also be factors in their corruption decision within the home country.

One important message from these empirical results is that corruption norms are sticky. This result raises the critical question of whether there are policy interventions that can modify corruption norms over time. For example, the Bloomberg administration's enforcement efforts in New York City in 2002 were extremely successful in changing diplomats' behaviors, and it would be useful to know whether these changes might additionally have had persistent effects on norms once individuals become habituated to rule-compliant behavior.

The authors' methodology of inexpensively generating cross-country data could potentially be applied to other settings where comparable individuals from across countries are present in the same place for a period of concentrated activity, such as the Olympics Games, for example.

-- Les Picker

The Digest is not copyrighted and may be reproduced freely with appropriate attribution of source.
 
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