A New Paradigm for the Study of Corruption in Different Cultures

Abstract. Corruption frequently occurs in many aspects of multi-party interaction between private agencies and government employees. Past works studying corruption in a lab context have explicitly included covert or illegal activities in participants ’ strategy space or have relied on sur-veys like the Corruption Perception Index (CPI). This paper studies corruption in ecologically realistic settings in which corruption is not suggested to the players a priori but evolves during repeated interaction. We ran studies involving hundreds of subjects in three countries: China, Israel, and the United States. Subjects interacted using a four-player board game in which three bidders compete to win contracts by submit-ting bids in repeated auctions, and a single auctioneer determines the winner of each auction. The winning bid was paid to an external “gov-ernment ” entity, and was not distributed among the players. The game logs were analyzed posthoc for cases in which the auctioneer was bribed to choose a bidder who did not submit the highest bid. We found tha