Thursday, January 28, 2010

Zero-Value Bribes (Or, The New Testament in India)

. Thursday, January 28, 2010

Is this a market in everything?

In Doha last month, CommGAP learned about the work of 5th Pillar, which has a unique initiative to mobilize citizens to fight corruption. In India, petty corruption is pervasive – people often face situations where they are asked to pay bribes for public services that should be provided free. 5th Pillar distributes zero rupee notes in the hopes that ordinary Indians can use these notes as a means to protest demands for bribes by public officials. I recently spoke with Vijay Anand, 5th Pillar’s president, to learn more about this fascinating initiative.

According to Anand, the idea was first conceived by an Indian physics professor at the University of Maryland, who, in his travels around India, realized how widespread bribery was and wanted to do something about it. He came up with the idea of printing zero-denomination notes and handing them out to officials whenever he was asked for kickbacks as a way to show his resistance. Anand took this idea further: to print them en masse, widely publicize them, and give them out to the Indian people. He thought these notes would be a way to get people to show their disapproval of public service delivery dependent on bribes. The notes did just that. The first batch of 25,000 notes were met with such demand that 5th Pillar has ended up distributing one million zero-rupee notes to date since it began this initiative. Along the way, the organization has collected many stories from people using them to successfully resist engaging in bribery.

One such story was our earlier case about the old lady and her troubles with the Revenue Department official over a land title. Fed up with requests for bribes and equipped with a zero rupee note, the old lady handed the note to the official. He was stunned. Remarkably, the official stood up from his seat, offered her a chair, offered her tea and gave her the title she had been seeking for the last year and a half to obtain without success. Had the zero rupee note reached the old lady sooner, her granddaughter could have started college on schedule and avoided the consequence of delaying her education for two years. In another experience, a corrupt official in a district in Tamil Nadu was so frightened on seeing the zero rupee note that he returned all the bribe money he had collected for establishing a new electricity connection back to the no longer compliant citizen.

This is yet another piece of evidence in favor of the argument that in order to succeed markets (and governments) must be embedded in a set of social institutions, many informal, that reinforce norms of reciprocity, fairness, and accountability. Without those ideals firmly in place, society can fail to progress, or break down rather rapidly. Deidre McCloskey calls them the "Bourgeois Virtues", although these examples from India would perhaps point to a more universalist explanation.

Of course this is not a new story.

ht: DavosBoy.


Zero-Value Bribes (Or, The New Testament in India)
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