Corruption process in Russia: level, structure, trends.

Corruption increase rate within four years’ period as a result of the recent survey made by the INDEM Fund

 

The principal feature of the practical everyday corruption resides in the fact that the volume of the everyday corruption market (i.e. sum of the bribes to be paid by citizens within one year) has not undergone any specific alterations along with a relevant increase from US$ 2,8 billion to 3,0 billion respectively. Although such a stable position is the result of the two dynamic processes being interacted. The first process may be seen as some corruption risk increase (authorities’ corruption pressure onto citizens) and corruption demand decrease (citizens’ readiness to bribe). The same trend reveals in some decreased everyday corruption intensity (average number of bribes per one briber annually) under significant growth of the average bribe amount. The second process appears as this average bribe amount within everyday corruption realm can be absorbed totally by national consumer prices’ growth.

The stability of the common everyday corruption market covers any rapid processes as to customers’ redistribution and cash flow  transfers within specific corruption market. The negative dynamics (or stability) of the volumes for such corruption markets as security service (militia), law courts, road police derives primarily from decreased corruption demand within these spheres sustained by reduced citizens’ applications to the relevant institutions. The citizens’ contacts with public health authorities are more difficult to cut down. So here one could see some diminished corruption market volume despite of the average bribe amount growth provided exclusively by decreased corruption demand: the citizens are just not eager to bribe. As to the militia authorities the situation obtains in reduction of the corruption demand together with lessening intensity per average bribe amount. In this case the market volume stability must be maintained by any corruption risk growth solely.

Of special note is the decreased market of the corruption services for dwellings’ repair works with its sharp decline of the citizens being ready to bribe. The rest of them are obliged to pay more and frequently and this process may not compensate for any losses related to the customers’ flow-out into a private sector.

The growth of the special markets’ volume as for everyday corruption is variable in its character. Thus, the growth of the corruption market volume for the higher education institutions should be ensured by relevant corruption risk increase (and, consequently, its intensity) against the background of decreased average bribe amount. It is believed that this given process owes to a sharp intensity growth of some inexpensive «services» such as payable exams and examination tests. In other words, the offer structure is still in progress within this market. In any other areas of services the growth of the average bribe amount provides a relevant corruption market increase. In case of conscription such growth is considerably in excess of the recession in demand for any services and intensity. Under other terms the bribe amount increase must be sustained by corruption intensity growth. The latter may evolve into existence due to either growth of demand for relevant official services or corruption risk growth.

Hence our citizens are ready to reject any corruption practice whereas any alternative methods of solving problems are available or if such a refusal may cause some moderate losses. The exception is represented by some case of rejecting bribe, which may constitute a threat to the children’s life.

In general we have to deal with two opposite behavior strategies: the authorities build up its pressure towards citizens and the citizens avoid corruption. If previously one could argue that corruption process may be caused by both parties, nowadays this given suggestion just conflicts with any facts available.

The different matter presents business corruption market. Here such a single parameter as corruption intensity (average number of bribes) has decreased by 20% approximately). And an everyday corruption intensity diminished a bit more. Probably because both businessmen and citizens tend to bribe more rarely.

All other business corruption indices have grown sharply. The average bribe amount increased by 13 times and its average annual value — about by 11 times respectively. The corruption market volume is nine and half times larger. But it should be mentioned that this growth is represented in its absolute expression. Along with the corruption parameters the relevant economic, budget, pricing figures enlarged as well. So the growth of the corruption itself (not indices’ values) must be compared to the economic growth figures. It is shown below as to the average bribe amounts and corruption market volume.

The average bribe amount correlates to the average cost of one square meter for living space within Russian primary dwellings’ market (or just presumably new flat). For a period of 2001-2005 this cost increased by 70 %. Thus, in 2001 on average bribe amount was equal to the cost of the living space area of 30 sq. m (mid-range quality). Four years after it is possible to purchase an apartment of 200 sq. m and more for a cost of the same average bribe, or the growth increased seven-fold approximately.

The volume of the business corruption market is comparable to the federal budget revenues increased by about 140% during period of 2001-2004. In 2001 the business corruption market was less than annual federal budget revenues by 30% if calculating on the basis of proportion of the federal budget revenues to the annual corruption market profit. In 2005 the business corruption market exceeds federal budget revenues 2,66 times. This figure implies a four-fold increase of the corruption market measured by revenues of the federal budget.

Some certain alterations have been made as per citizens’ estimations and suggestions. The growing number of citizens evaluated the high national corruption level has been registered. In particular, a portion of respondents presuming the maximum corruption level under current presidency increased three-fold approximately. The apprehension of the corruption process as social phenomenon grew also.

The significant variable as distinctive characteristic of our respondents is its «Corruption objective» reflecting a degree of any positive or negative attitude towards this social factor. No any important changes as per corruption objective have been found. Such a discrepancy between behaviour and objectives is a matter of familiar experience for the social psychology. One could suggest that we evidence some essential alteration of the social practices caused by any increased belligerence of the corrupted environment. But these practical alterations have not been yet sustained and stabilized by relevant changes of the population anti-corruption objectives.

About our survey

The sociological survey on corruption was performed by the INDEM Fund in spring, 2005 and under financial terms due to some private persons’ (Russian citizens) contributions. The field study has been carried out by the Research Holding ROMIR Monitoring.

This given survey has been made with purpose to find out such items as follows:

  • Corruption level and structure analysis;
  • Corruption particular practices’ analysis;
  • Population objectives’ analysis as to corruption process;
  • Corruption dynamics (trends) analysis;
  • Development of the recommendations on realizing anti-corruption policy.

It was supposed to correlate these survey results with some results of the corruption study made by the INDEM Fund in 2001.

Each research wave involved public-opinion polls and business representatives’ interrogation.

Both 2001 and 2005‘ surveys used some specialized mathematics and statistics methods of the sociological analysis enabling to obtain a voluminous overview on corruption process on the basis of relevant reliable indices. The survey information is unprecedented as having no similar data available in the global practice of investigating corruption process. Several special software tools for analyzing sociological data have been elaborated for this recent study.

This given project is being performed in persons of the research team members as follows:

Georgy Satarov  project team leader;

Yuri Blagoveschensky  mathematicians team leader;

Nikolay Blagoveschensky, Igor Vinyukov  mathematicians-programmers;

Vladimir Rimsky  sociological division head, INDEM Fund;

Nikolay Popov  Research Holding representative, ROMIR Monitoring;

Mikhail Krasnov, Mark Levin, Konstantin Golovschinsky, Sergey Parkhomenko, Ilya Koutukov  research team members.

This given report may be described as some tentative one. Currently a book analyzing corruption process in Russia is in preparation by the INDEM Fund upon materials of this particular one and previous surveys.

Population-opinion polls

The sampling amount was 2,000 respondents in 2001 and 3,000 respondents in 2005 respectively. In both cases the representative, all-Russian, multi-stage, territorial, stratified random sampling was used. Such items as federal districts, settlement types, gender and age issues have been represented. Since such kind of sampling does not suggest representing Federation subjects (republics, territories, regions) some Federation subjects have been sampled at random or directionally because of the need to submit sampling of some various economic and geographic territories.

In the first wave sampling one of the selection criteria as per regions inside federal district was its regional social & economic development type including, in particular, a relevant level of economic development, i.e. if this given region is donor-active or state-subsidized one. Thus, the above sampling included the Federation subjects as follows:

—         Moscow

—         Central Federal District  Kaluga Region, Kostroma Region;

—         North West Federal District  Leningrad Region, St. Petersburg, Novgorod Region;

—         Privolzhsky Federal District  Perm Region, Chuvash Republic;

—         South Federal District  Stavropol Territory, Volgograd Region;

—         Urals Federal District  Udmurt Republic, Sverdlov Region;

—         Siberian Federal District  Irkutsk Region, Omsk Region;

—         Far Eastern Federal District  Primorsk Territory, Khabarovsk Terrotory.

The 2005 opinion poll covered sampling of 3,000 respondents including more Federation subjects (29) and settlements. At the same time most subjects of the Federation subjects from the first wave have been included for obtaining more comparable results.

In both waves the field information gathered in strict accordance with the developed methods and stipulated quotas. As a result the derived data are not differed in practice by its social and demographic characteristics from a relevant Roscomstat statistics database. Thus, two research waves have been performed by one and the same research company as per unified methods, sampling system, interviewing procedure allowing definite conclusions on any standpoints and assessments which must reflect real alterations of the massive population views as to corruption problems.

Businessmen opinion polls

The two waves of the businessmen polls have been performed as per similar methods. The second wave sampling was increased up to 1,000 respondents comparable to 700 respondents of the first wave. In accordance to the recent appraisal results of the Russian economic structure the sampling portion for the corporate representatives involved in rendering services and business was enlarged up to 40% and diminished from 60% to 40% for industry, construction and transport areas respectively. As a whole the two poll waves for business environment per corruption problems may be considered parts of the single research reflecting dynamics of the business representatives’ evaluations on national corruption situation and corruption practice.

Everyday corruption practice in Russia

 

Table 1. Everyday all-Russian corruption market characteristics (as a time history of phenomenon)

Corruption characteristics 2001 2005
Corruption coverage (%) 50,4 54,9
Corruption risk (%) 25,7 35,0
Corruption demand (readiness to bribe, %) 74,7 53,2
Corruption intensity (average number of bribes per annum for bribers) 1,19 0,882
Average bribe amount for bribers (rubles) 1817 2780
Average bribe portion within cost of living (for 2001 and 2004 respectively) 1,21 1,17
Average annual contribution for a briber (rubles) 2162 2452
Annual volume of the everyday corruption market(US$ billion) 2,825 3,014

Notes:

Corruption coverage  share of citizens captured (even once) by the corruption situation irrespective of its outcome: whether in this case they have bribed or not.

Corruption risk  share of citizens’ entrapment into some corruption situation due to any problems. The corruption risk may be seen as an index of the authorities’ corruption pressure upon citizens.

Corruption demand (readiness to bribe) – share of cases when an average citizen bribes under corruption situation. The corruption demand may be seen as an index of the citizens’ readiness to use corruption methods so that to solve its problems or some readiness to fall under authorities’ corruption pressure.

Corruption intensity  an average number of bribes per annum for a single arbitrary briber in this given year.

Average bribe amount  an average bribe sum per a single arbitrary corruption deal in this given year.

Average annual contribution  average annual costs of a single arbitrary briber in this given year. This rate may be determined as product of the corruption intensity by an average bribe amount.

Annual market volume  evaluation (from the bottom) of the total turnover for corruption market as an entire sum of any bribes to be paid by all bribers annually.

These characteristics (probably besides the item of corruption coverage) may be calculated for both total national everyday corruption market and individual and special markets of any everyday corruption (see below). For instance, any bribes related to the medical services form a special market of the everyday corruption.

Thus, the total everyday corruption market displays its stable position. The average bribe value in its real form may even shows its slight decrease. But the registered difference may be quite compensated for by metering error. Although this dynamic stability is formed by mutual action of the two opposite tendencies: the authorities  intensify its corruption pressure upon citizens and in response the citizens lower is corruption demand.

Table 2. Special everyday corruption market characteristics (as a time history of phenomenon)

 

#

Problem (everyday corruption market) Corruption risk Corruption demand (readiness to bribe)
2001 2005 2001 2005 D
1 Free medical service (out-patients’ clinic, hospital) 23,5 37,7 80,4 62,0 0,80
2 School: to enter required school and to finish successfully, education process 13,2 41,0 76,2 60,8 0,70
3 Higher education institution: to enter, transfer to another one; exams etc. 36,0 52,1 66,7 63,2 0,18
4 Pensions: paperwork, calculation etc. 11,3 11,4 50,0 17,1 2,29
5 Social payments: paperwork, calculation etc. 16,2 19,8 47,4 30,6 1,23
6 Solving problems related to the conscription procedure 32,6 57,7 50,0 63,4 -0,93
7 Employment: to get a required job or career development 24,6 29,2 80,0 35,0 1,95
8 Land area: to obtain some territory (for a country cottage or some own farming entity) 14,9 39,8 75,0 51,1 1,11
9 Dwelling: to obtain and/or legalize a relevant proprietary interest 28,9 34,3 75,6 41,9 1,55
10 To get dwelling maintenance & repair work services 32,2 29,5 60,5 31,6 1,66
11 To obtain justice in law-court 26,2 39,5 59,4 43,6 0,92
12 To get assistance and protection from militia authorities 27,4 40,2 77,3 54,7 1,02
13 To get registration, domestic or foreign passport at the place of residence 19,7 32,7 76,0 48,9 1,24
14 To solve problems with road police authorities(obtaining driver’s license, technical examination, road traffic etc.) 59,3 59,6 86,0 68,9 0,69

Note

The D value characterizes a degree of recession in demand for corruption within this given market and may be calculated as follows: firstly the percentage reduction in demand for corruption per each market was calculated as demand difference ratio in 2001 and 2005. Afterwards these values were divided by a total percentage reduction in demand (Table 1 data). Thus, the D value shows how the demand alteration within this given everyday corruption market exceeds (if the D value is more than 1) or succumbs (if the D value is less than 1) to the alteration of demand for corruption within total everyday corruption market.

Within area of data on corruption risk a remarkable stability of the two polar markets should be noted as the most risky corruption market for road police services and the least risky market for provision of pensions. The risk of corruption situation within market for dwelling maintenance and repair work tends to diminish for an obvious reason as this given realm is being increasingly transferred from the state bodies to some private entities. All other markets point clearly to the distinct growth of the corruption risks. Here among the leading entities are schools (corruption risk growth more than 200 %), land areas (growth almost by 170 %), military registration and enlistment offices (77 %). (The relevant percentage growth has been calculated on the basis of the risks difference ratio in 2005 and 2001 to a risk of 2001).

The demand for corruption displays a total significant reduction with a sole exception for military registration and enlistment offices (whereupon the corruption demand grew by 70 %.). The reason has to do with the Chechen war being continued and total unfavorable situation within Russian army as well. The D value evidenced that any readiness to bribe for solving conscription problems may grow with much the same effect as the total readiness to bribe is diminished. Such issues as pensions, employment, dwelling maintenance, legalization of proprietary interest are leading ones as per process of recession in demand for corruption. The demand for corruption in the higher education institutions appears very slightly.

Thus, our citizens are ready to reject any corruption practice whereas any alternative methods of solving problems are available or if such a refusal may cause some moderate losses. The exception is represented by some case of rejecting bribe which may constitute a threat to the children’s life.

In general we have to deal with two opposite behavior strategies: the authorities build up its pressure towards citizens and the citizens avoid of corruption. If previously one could argue that corruption process may be caused by both parties (as bribers and bribe-takers), nowadays this given suggestion just conflicts with any facts available.

Table 3. Dynamics of the special everyday corruption markets’ annual volumes. Total market share has been calculated as a ratio to the sum of the market volumes shown in the Table. The D value is determined as percentage alteration of the market volume comparable to the 2001′ level .

 

#

Problem (everyday corruption market) Market volume (US$ million) Total market share D (%)
2001 2005 2001 2005
1 Free medical service (out-patients’ clinic, hospital) 602,41 401,1 0,2870 0,148 -33,4
2 School: to enter required school and to finish successfully, education process 70,10 92,4 0,0333 0,034 31,8
3 Higher education institution: to enter, transfer to another one; exams etc. 449,37 583,4 0,2138 0,215 29,8
4 Pensions: paperwork, calculation etc. 0,29 7,9 0,0001 0,003  
5 Social payments: paperwork, calculation etc. 6,62 80,3 0,0031 0,030  
6 Solving problems related to the conscription procedure 12,66 353,6 0,0060 0,130 2693,0
7 Employment: to get a required job or career development 56,16 143,4 0,0267 0,053 155,3
8 Land area: to obtain some territory (for a country cottage or some own farming entity) 20,09 84,4 0,0096 0,031 320,1
9 Dwelling: to obtain and/or legalize a relevant proprietary interest 123,02 298,6 0,0585 0,110 142,7
10 To get dwelling maintenance & repair work services 22,67 15,6 0,0108 0,006 -31,2
11 To obtain justice in law-court 274,48 209,5 0,1306 0,077 -23,7
12 To get assistance and protection from militia authorities 29,95 29,6 0,0142 0,011 -1,2
13 To get registration, domestic or foreign passport at the place of residence 65,84 87,7 0,0313 0,032 33,2
14 To solve problems with road police authorities(obtaining driver’s license, technical examination, road traffic etc.) 368,38 183,3 0,1752 0,068 -50,2

Note: No data are available for percentage alterations within pension and social welfare markets. In this case the observed growth rests on the assumption that this actual market volume level was severely underestimated in 2001.

As shown in Table the relative stability within total everyday corruption market conceals some significant alterations for special markets. Such important and powerful markets as public health, dwelling maintenance, legal authorities, road police services have lost from 20% to 50% of its corruption revenues. The similar moderate increase is intrinsic for school institutions, passport offices. The 100-300% growth appeared within such corruption markets as employment, land, dwelling areas. Finally, a huge growth of such a kind has been evidenced by the military registration and enlistment offices. It is obvious that the above structural alterations may be interpreted in various ways and the possible explanation can be found upon any additional information.

Table 4. Dynamics of the average bribe amount (rubles). The rank 1 is assigned to the largest average bribe; the ranks were calculated within this given markets list. The D value characterizes rate of growth as to bribe amount and has been calculated by formula given in the notes to the Table 2.

 

#

Problem (everyday corruption market) 2001 2005 D  
Value rank value rank  
1 Free medical service (out-patients’ clinic, hospital) 1093 8 1423 11 0,57
2 School: to enter required school and to finish successfully, education process 1238 7 2312 8 1,64
3 Higher education institution: to enter, transfer to another one; exams etc. 4305 2 3869 4 -0,19
4 Pensions: paperwork, calculation etc. 50 14 2250 9  
5 Social payments: paperwork, calculation etc. 250 13 3467 6  
6 Solving problems related to the conscription procedure 3250 3 15409 1 7,06
7 Employment: to get a required job or career development 963 9 2448 7 2,91
8 Land area: to obtain some territory (for a country cottage or some own farming entity) 2000 5 3713 5 1,62
9 Dwelling: to obtain and/or legalize a relevant proprietary interest 2529 4 5548 3 2,25
10 To get dwelling maintenance & repair work services 292 12 400 14 0,70
11 To obtain justice in law-court 13964 1 9570 2 -0,59
12 To get assistance and protection from militia authorities 1715 6 930 12 -0,86
13 To get registration, domestic or foreign passport at the place of residence 664 11 1426 10 2,17
14 To solve problems with road police authorities(obtaining driver’s license, technical examination, road traffic etc.) 896 10 920 13 0,05

Note: No data are available for percentage alterations within pension and social welfare markets. In this case the observed growth rests on the assumption that this actual market volume level was severely underestimated in 2001.

As shown in the Table 4 at the background of the common tendency towards bribing growth the bribes for higher education, law-courts, militia authorities have gone down in price evidently. The level of the militia bribes decreased from the convenient sixth position to a not very profitable 12thone. The bribes became significantly more expensive within markets as follows: secondary education, employment, land purchase, dwelling, passport offices. The maximum growth was seen in the military registration and enlistment offices. And previously here the bribing level was not poor (honorable third position). But now its first place has been registered (possessed by the legal authorities before). It is possible to state that this sharp growth of the average bribe amount has defined an increase of the corruption market at the military registration and enlistment offices above all.

Table 5. Dynamics of the corruption intensity within various everyday corruption markets. The rank 1 is assigned to the most intensified market; the ranks were calculated within this given markets list. The D value characterizes rate of fall as to corruption intensity and has been calculated by formula given in the notes to the Table 2 (the positive D value corresponds to a value of fall from 2001 to 2005).

 

#

Problem (everyday corruption market) 2001 2005 D
value rank value rank
1 Free medical service (out-patients’ clinic, hospital) 1,098 4 0,847 7 0,883
2 School: to enter required school and to finish successfully, education process 2,213 1 0,950 5 2,205
3 Higher education institution: to enter, transfer to another one; exams etc. 0,820 10 0,875 6 -0,259
4 Pensions: paperwork, calculation etc. 0,669 13 0,339 14 1,906
5 Social payments: paperwork, calculation etc. 1,065 6 0,657 12 1,480
6 Solving problems related to the conscription procedure 1,010 7 0,650 13 1,377
7 Employment: to get a required job or career development 0,950 8 1,053 2 -0,419
8 Land area: to obtain some territory (for a country cottage or some own farming entity) 0,655 14 0,698 10 -0,254
9 Dwelling: to obtain and/or legalize a relevant proprietary interest 0,848 9 0,809 8 0,178
10 To get dwelling maintenance & repair work services 0,771 11 0,954 4 -0,917
11 To obtain justice in law-court 0,681 12 0,672 11 0,051
12 To get assistance and protection from militia authorities 1,787 2 0,809 9 2,115
13 To get registration, domestic or foreign passport at the place of residence 1,107 3 1,030 3 0,269
14 To solve problems with road police authorities(obtaining driver’s license, technical examination, road traffic etc.) 1,089 5 1,120 1 -0,110

Some intensity growth has been exhibited within several everyday corruption markets against background of the total corruption intensity decrease. The 10% growth provided the road police with its first position comparable to the previous tenth one. The employment and dwelling maintenance markets’ growth are of greater intensity. The moderate increase was displayed by the higher education and land areas markets. The registered growth is compensated for sharp fall within other markets due to, probably, two factors. The first issue is a sharp rise in price for the corruption services (as in the case with the military registration and enlistment offices) and the second one is refusal from interaction with authorities (as in the case with militia). Both issues resulted in reducing demand for corruption.

The latter may be ascertained upon alterations of the citizens’ applications to the appropriate state services’ markets. Such information is shown in the next table. Here various services’ markets are featured by value of demand for state services. This value per each services’ market may be displayed as follows: probability of any average citizen’s interaction with state authorities within this given services’ market (among fourteen markets under study). For example, in 2001 an average citizen needed services on legalization of its proprietary interest for land area in 4% of cases.

Table 6. Dynamics of demand for state services (%). The rank 1 is assigned to the most demanded market; the ranks were calculated within this given markets’ list. In this case the D value is the percentage demand alteration and had been calculated as percentage of the demand difference in 2005 and 2001 comparable to the 2001′ demand (the positive D value corresponds to values’ growth from 2001 to 2005).

 

#

Problem (everyday corruption market) 2001 2005 D
Value rank value Rank
1 Free medical service (out-patients’ clinic, hospital) 16,1 1 23,6 1 46,6
2 School: to enter required school and to finish successfully, education process 6,1 9 2,9 12 -52,5
3 Higher education institution: to enter, transfer to another one; exams etc. 8,1 4 7,4 6 -8,6
4 Pensions: paperwork, calculation etc. 7,1 6 7,0 8 -1,4
5 Social payments: paperwork, calculation etc. 7,4 5 10,2 2 37,8
6 Solving problems related to the conscription procedure 4,6 13 1,8 14 -60,9
7 Employment: to get a required job or career development 6,4 8 8,5 3 32,8
8 Land area: to obtain some territory (for a country cottage or some own farming entity) 4,0 14 3,1 11 -22,5
9 Dwelling: to obtain and/or legalize a relevant proprietary interest 5,3 11 8,0 4 50,9
10 To get dwelling maintenance & repair work services 8,8 3 7,6 5 -13,6
11 To obtain justice in law-court 4,8 12 2,8 13 -41,7
12 To get assistance and protection from militia authorities 5,6 10 3,4 10 -39,3
13 To get registration, domestic or foreign passport at the place of residence 6,4 7 7,0 7 9,4
14 To solve problems with road police authorities(obtaining driver’s license, technical examination, road traffic etc.) 9,3 2 6,7 9 -28,0

As shown in Table 6 our citizens contacted more rarely with the following realms of the state services such as: school, conscription, legal authorities, militia. At the same time contacts within such spheres as public health services and legalization of the proprietary interest grew.

Taking into account these data it is possible to analyze the dynamics of the special corruption markets’ volumes. The negative dynamics (or stability) of the volumes for such corruption markets as security service (militia), law courts, road police derives primarily from decreased corruption demand within these spheres sustained by reduced citizens’ applications to the relevant institutions. The citizens’ contacts with public health authorities are more difficult to cut down. So here one could see some diminished corruption market volume despite of the average bribe amount growth provided exclusively by decreased corruption demand: the citizens are just not eager to bribe. As to the militia authorities the situation obtains in reduction of the corruption demand together with lessening intensity per average bribe amount. In this case the market volume stability must be maintained by any corruption risk growth solely.

Of special note is the decreased market of the corruption services for dwellings’ repair works with its sharp decline of the citizens being ready to bribe. The rest of them are obliged to pay more and frequently and this process may not compensate for any losses related to the customers’ flow-out into a private sector.

The growth of the special markets’ volume as for everyday corruption is variable in its character. Thus, the growth of the corruption market volume for the higher education institutions should be ensured by relevant corruption risk increase (and, consequently, its intensity) against the background of decreased average bribe amount. It is believed that this given process owes to a sharp intensity growth of some inexpensive «services» such as payable exams and examination tests. In other words, the offer structure is still in progress within this market. In any other areas of services the growth of the average bribe amount provides a relevant corruption market increase. In case of conscription such growth is considerably in excess of the recession in demand for any services and intensity. Under other terms the bribe amount increase must be sustained by corruption intensity growth. The latter may evolve into existence due to either growth of demand for relevant official services or corruption risk growth.

The particularities for dynamics as per everyday corruption practice may be mentioned upon some individual features of the corruptive interactions between citizens and authorities. Such course can be traced by the citizens-bribers’ replies to some questions. Sampling rate as per replies is shown in the following tables.

Table 7. Citizens’ replies’ rate (%) to the question: «Have you managed to resolve this problem without bribing/gift or have you refused any efforts to solve it?». This question was replied only by those respondents who did not bribe encountering last corruption situation.

Replies’ versions 2001 2005
Yes, I have managed 49,8 68,3
No, I haven’t and refused from any efforts to solve it 45,1 31,7
Rejection of reply 5,1 0

As shown in this Table the citizens refuse corruption not only due to its moral protest but also for that important and practical reason because they are capable to resolve their problems without bribing: the reply rate as «yes, I’ve managed» grew quite significantly. The possibilities of such a kind when the citizens find out new opportunities avoiding corruption procedures are the essential anti-corruption means to be taken up by the state bodies within its anti-corruption framework.

Table 8. Citizens’ reply rate (%) to the question: «Have you bribed any official and for what reason or initiative?». This question was replied only by those respondents who did bribe encountering last corruption situation.

Replies’ versions 2001 2005
The official has forced (implied, made a situation of such a kind) 17,4 25,1
The necessity of bribing procedure was known in advance 57,2 54,2
The official has not insisted but I had considered it more reliable factor 20,3 18,3
It is difficult to reply (or rejection of reply) 5,1 2,4

As shown in the Table 8 the officials initiated any corruption deal more often than previously. This given fact corresponds to results of the analysis as per everyday corruption market (some conclusion on an increased corruption pressure of the officials upon citizens has been drawn above.

Table 9. Citizens’ replies rate (%) to the question: «Have you been aware of the evident bribe amount or any «gift» cost?». This question was replied only by those respondents who did bribe encountering last corruption situation.

Replies’ versions 2001 2005
Completely clear 23,4 29,8
Practically clear 37,1 40,7
Not very clear 25,0 21,4
Not clear at all 13,9 8,1
Rejection of reply 0,5 0

The Table evidenced the citizens’ awareness growth about corruption market availability. This deduction may be proved with another observation: in 2005 the citizens used such replies as «It is difficult to reply» or even rejected to reply more rarely than in 2001.

Business corruption practice in Russia

 

Table 10. Characteristics of the all-Russian business corruption market in its dynamics. The D value is percentage alteration (the positive value corresponds to the growth).

Characteristics 2001 2005 D
Corruption intensity 2,248 1,795 -20,2
Average bribe amount (US$ thousand) 10,2 135,8 1231,4
Annual average contribution (US$ thousand) 22,9 243,75 964,4
Market volume (US$ billion) 33,5 316 843,3
Dwelling space to be bought for a single average bribe (sq. m) 30 209 596,7
Ratio of the business corruption market volume to federal budget revenues 0,66 2,66 303,0

Here one could see that only one index as corruption intensity (average number of bribes) diminished by 20% approximately). The intensity of everyday corruption market reduced a little bit more (see Table 1). Perhaps both businessmen and citizens tend to bribe more rarely.

All other business corruption indices have grown sharply. The average bribe amount increased by 13 times and more and its average annual value — about by 11 times respectively. The corruption market volume is almost nine and half times larger. But it should be mentioned that this growth is represented in its absolute expression. Along with the corruption parameters the relevant economic, budget, pricing figures enlarged as well. So the growth of the corruption itself (not indices’ values) must be compared to the economic growth figures. It is shown below as to the average bribe amounts and corruption market volume.

The average bribe amount correlates to the average cost of one square meter for living space within Russian primary dwellings’ market (or just presumably new flat). For a period of 2001-2005 this cost increased by 70 %. Thus, in 2001 on average bribe amount was equal to the cost of the living space area of 30 sq. m (mid-range quality). Four years after it is possible to purchase an apartment of 200 sq. m and more for a cost of the same average bribe, or the growth increased seven-fold approximately.

The volume of the business corruption market is comparable to the federal budget revenues increased by about 140% during period of 2001-2004. In 2001 the business corruption market was less than annual federal budget revenues by 30% if calculating on the basis of proportion of the federal budget revenues to the annual corruption market profit. In 2005 the business corruption market exceeds federal budget revenues 2,66 times. This figure implies a four-fold increase of the corruption market measured by revenues of the federal budget.

With purpose to represent structure of the business corruption market in its preliminary order it is necessary to examine some corruption dealings via authorities’ branches and regulating bodies’ types.

Fig. 1. Rating diagram (%) of the businessmen replies to the question about correlation between any authorities’ branch and specific governing or regulating body. This question has been made towards those respondents replied on particularities of their last corruption experience.

As shown in this diagram no significant alterations occurred in the distribution process of the corruption dealings among relevant authorities’ branches. Some reduced share of the executive power may be explained by the section «It is difficult to reply» which grew significantly.

The same tendency can be seen also in the replies’ rates of which are shown in the Table 11. Here the same structural stability may be evidenced and the observed deviations are quite explicable due to an increased section «It is difficult to reply». (With consideration of the taxation services’ strict rules it should be reasonable to avoid any appropriate replies under interrelations with those bodies).

Table 11. Citizens’ replies’ rates (%) to the question: «What kind of regulating functions did this body, organization carry out?». This question was made towards those respondents replied on any particularities of their last corruption interrelation experience.

Replies’ versions 2001 2005
Non-financial control, supervising 39,5 38,9
Fiscal, taxation 19 12,2
Licensing 19 16,4
Customs 4,2 1,2
Law enforcement 10,5 11,8
Other 3,3 3
It is difficult to reply or rejection of reply 4,5 16,5

Some tentative conclusion can be made that principal structural relationship retained within business corruption market. The main alteration became a sharp growth of bribing process as part of the common increased corruption pressure onto business circles. Unlike citizens the businessmen have got less opportunities to escape from any interrelation with state bodies and to seek any alternative methods of solving problems. So a severe increase of the business corruption occurred which can not be compensated for by any running away.

The next diagram shows how the corruption market is divided by current authority branches.

Fig. 2. Diagram of corruption market shared by three authorities’ branches (legislative, executive, legal).

Here one could see a pattern similar to the Fig. 1. The most part of the corruption revenues retained by the executive power which is quite natural process as the businessmen most commonly deal with this authority branch representatives. The obtained statistic data evidenced two essential features of the Russian life: firstly, the executive power is every bit as important (comparable with two others) as its corruption revenues’ share exceeds profits of the legislative and executive powers; secondly, the Russian economy is being regulated up to some fantastic degree.

If, as noted earlier, the citizens demonstrate a sharp fall of the replies’ rate «It is difficult to reply», so the businessmen exhibit an opposite tendency as illustrated by the two above examples.

Fig. 3. Diagram of replies’ rate (%) to the question «It is difficult to reply» in relation to the question «Could you remind the last time when you (your company) were obliged to use some «stimulating issues» of any kind towards officials so that to solve your business problems

Strange as it may seem that businessmen do realize the corruption realm in comparison to any other citizens. So this growth of the replies’ rate as «It is difficult to reply» in relation to the business circles may be explicable only by such sole issue as fear of the official bureaucracy arisen from an increased corruption pressure.

The analysis data exhibit that the larger are business activities the more often its representatives escape from replies as illustrated by the above Fig. 3. Here one can see that in 2001 businessmen of any levels often and almost equally used the reply «It is difficult to reply». In 2005 the evident rule occurred: the bigger is this given entity the more often its representatives use such a reply («It is difficult to reply»). The auxiliary study showed that major and mid-range business representatives tend to diminish any data on its turnover and, accordingly, bribes’ amounts. All this produce corruption parameters’ values (Table 10) which have been deliberately decreased. Some our calculations allow to say that the real corruption level is at least 1,5 times higher than those lower values as shown in the Table 10.

Respondents’ attitude towards corruption process

 

The respondents’ opinions and evaluations analysis as per the corruption is not less important than a relevant analysis of their practice. It should not be forgotten that respective attitudes affect behaviour to some extent. Below are shown the dynamics data of the respondents’ attitudes (citizens and businessmen) as per three following categories: «Corruption level assessment», «Corruption process understanding», «Corruption attitude». The respondents’ attitudes per these given variables have been made by a special technology developed at the INDEM Fund based upon respondents’ replies to a series of questions related to each variable. Apart from it the replies’ rates are displayed to the questions regarding these variables.

Fig. 4. Diagram of the rates distribution per respondents’ typological classes «Corruption level assessment» (%) for sampling citizens and businessmen in 2001 and 2005.

Here one could see the increased share of those who evaluate the national corruption level as the high one — within both citizens’ and businessmen sampling. Such a shift is formed by the shifts in the replies to individual questions of the questionnaire. The appropriate example is shown below.

Table 12. Citizens’ and businessmen replies rate (%) to the question «When in your opinion were such issues as corruption, bribing, misappropriation of the state resources, illegal protection and nepotism in use more?». Besides this some other replies have been presumed under Gorbachev era», «in the Soviet period», «before the Revolution); two versions of replies were admitted. The D value is the percentage index alteration (the positive value corresponds to the growth).

Replies’ versions Citizens Businessmen
2001 2005 D 2001 2005 D
Under Yeltsin presidency 58,0 57,8 -0,3 57,3 53,8 -6,1
Under current Putin’s presidency 14,3 43,1 201,4 11,0 37,6 241,8

One can see that along with stable assessment of the corruption under Yeltsin period of rule the evaluation of the high corruption level under current presidency grew by three times and by three and half times among citizens and businessmen respectively. At the same time and together with relevant growth of the evaluation of the corruption level the understanding of the corruption process as social phenomenon also increased. This fact may be illustrated by diagram below.

Fig. 5. Diagram of the rates distribution per respondents’ typological classes «Corruption process understanding» (%) for sampling citizens and businessmen in 2001 and 2005.

The essential variable featuring respondents is its «Corruption attitude» showing a degree of positive or negative respondents’ attitude towards this social factor. No significant shifts in this attitude towards corruption process occurred. Such a discrepancy between behaviour and attitudes is a matter of familiar experience for the social psychology. One could suggest that we evidence some essential alteration of the social practices caused by any increased belligerence of the corrupted environment. But these practical alterations have not been yet sustained and stabilized by relevant changes of the population anti-corruption objectives.

One could see how practice may influence human attitudes on the basis of the example as illustrated by the following diagram.

Fig. 6. Correlation between payments’ parameters of the businessmen estimating the national corruption level as medium and high one.

Two businessmen groups estimating the national corruption level in different ways are approximately equal by its number. At the diagram (Fig. 6) such values as corruption intensity (average annual number of bribes), average bribe amount and common annual payments come in figure 1 for businessmen group evaluating the national corruption level as medium one. The second column constantly displays how much are the same characteristics’ values for businessmen group evaluating the national corruption level as high one. Here it is obvious that the businessmen of the second group do bribe more often (and larger bribes). Accordingly the larger is their contribution into a total corruption turnover. One could suggest that their corruption practice (which is much heavier) promotes any relevant and more critical evaluation of the domestic corruption level.