Corruption. A Study in Political Economy by Susan Rose-Ackerman

By Susan Rose-Ackerman

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Here, while "apathetic" voters may have information about legislators' positions on the issues, these data are unimportant to them since their votes are determined exclusively by personal favors or payoffs provided by the candidates. 1 All these cases require modifications of the earlier analysis in which legislators faced a stark tradeoff between personal income and the likelihood of victory in the next election. Instead, it will often be possible for interest groups to substitute legal activities for corrupt payments in an effort to influence legislative 1 This case seems closest to the American reality.

14 For example, Popkin et al. (1976) and Magee and Brock (1976). 15 Ben-Zion and Eytan (1974), Brock and Magee (1975), Magee and Brock (1976), and Welch (1974) have developed similar models in which policy and campaign expenditures are inputs in a production function for votes. Politicians deviate from the median voter's policy optimum in order to gain money from interest groups; this money is then used to produce votes. Politicians choose an equilibrium policy where the marginal vote loss from undesirable policy equals the marginal vote gain from the added campaign expenditure.

THE STRUCTURE OF INTEREST GROUP ORGANIZATION Given the utility functions of legislators, I can now show how the structure of interest group organization will affect the volume and incidence of corruption. There are two basic situations. 20 Here the analysis is straightforward. If the group can command the honest support of only a minority of the legislators on some issue, it merely calculates the minimum bribe required to influence each of the legislators who favor the majority. So long as the group's funds are sufficient, it can then bribe enough of the cheapest members of the majority to change the outcome of the vote.

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