The Abandoned Trustees. Explaining Corruption in Local Government

Abstract

This paper engages in the debate about how different ways of organizing relations between politicians and bureaucrats affect corruption. Research has established robust correlations between the political autonomy of bureaucracy and low corruption, on both national and regional levels, but there are few studies that explore the causal mechanisms linking these two phenomena. We do so by comparing public procurement processes in two similar Spanish cities, interviewing all important actors. We show that relatively independent bureaucrats—so-called trustees—can act as checks to prevent political moral hazard. Yet, in order for this to occur, other institutions must support the trustee, such as a merit-based human resources policy, rules, and standard operating procedures, transparency and independent watchdogs. There is thus no silver bullet to defend us against corruption, but having these mechanisms in place makes it much more costly for politicians to opportunistically bend public procurement processes to favour bribe-paying contractors.