Corruption in Bulgaria

By Yoana Tchompalova

Yoana is a second year student from Bulgaria at University of Bath, studying Politics and International Relations 

Introduction

Corruption is a complex phenomenon which can affect the economic, social and political sector of a country. It has been present since ancient times. “Corruption was discussed in writing by Kautilya of India in 300 B.C.” (Wu, T. 2003, p.3). Because of its increasing prevalence recently, especially in the developing world and in the post-communist countries, international organisations like the UN, the EU, The World Bank and the OECD have been giving multiple definitions of corruption while trying to fight it efficiently. Different tools and indexes have been developed for its measuring too. For example, the OECD defines corruption as “a multi-layered phenomenon that may not always lend itself to neat definitions” (2003, p.117). The main argument that this paper advances is that corruption is very a dangerous phenomenon because it is the source of economic problems, poverty and inequality, and sometimes even political disengagement. It continues to be an issue in many countries, although the constant anti-corruption measures that are being undertaken from governments and organizations. Bulgaria, a post-communist country in Eastern Europe, has been trying to fight corruption and injustice for many years now. Corruption was a big obstacle for its joining the EU. The population of the country will benefit if proper anti-corruption practices are undertaken. That is why further research needs to continue to be conducted in order to find the causes of the phenomenon and prevent it in the future.

The research question of this research project is: Has the level of corruption in Bulgaria increased since joining the EU? The proposed hypothesis is that corruption in the country has increased since it joined the EU and that the reasons for this are the inefficient measures undertaken to eradicate it, which are assisted by the developed tradition of corruption in the country.

This project proposal proceeds in four steps. First, it will be discussed why the topic of corruption is relevant and important to be researched, and in particular why is it of great significance for Bulgaria. Second, the theoretical approaches to corruption will be outlined and the methodology for the research will be discussed. Next, a timeline will be drawn for the duration of the research. Finally, the last section will reflect on the implications and contributions of the project.

Literature Review

This paper contributes to the debate on corruption and its causes by focusing on a single case study. It does that by examining the level of corruption in Bulgaria since its acceptance in the EU. It fills the gap in the literature by focusing on the judicial corruption in the country, which is perceived as the biggest obstacle to removing other types of injustice.

Corruption has generally been defined as “misuse” power for private gain. Most of the literature on corruption focuses on its nature and the consequences of it. At first it was perceived that corruption is always connected with the public sector. It was defined by the World Bank as the ‘the misuse of public office for private gain’ (2012). Then its scope was broadened to add the private sectors as well. Transparency International defined corruption as “abuse of entrusted power for private gain” (2009). The OECD (2003) added to the definition not only the involvement of money but also gifts, informal promises and favours, nepotism. So, corruption involves any kind of activity which aims to “buy” someone so as to fulfil a personal aim in the expense of the public. “If a good allocated by a public official does not go to the population, we consider that to be corruption; if a good is allocated to a public official, with this agent making use of his or her position, we consider that to be corruption” (Kaufmann and Vicente, 2011, p.198).

“Much of the corruption literature exploring the underlying causes and consequences of corruption fail to differentiate forms of corruption” (Morris, 2011). There are different forms of corruption and in the literature many ways of classifying the forms have been introduced. Corruption can take place in any part of the government – the legislature, judiciary or the executive branch or the local government, and in the private sector too. One type is “political corruption”, which violates unwritten patterns of conduct of public officials, while another is “bureaucratic corruption”, which oversteps written rules and norms. There is “upper-level” and “lower-level” also called “petty” corruption based on the roles and functions of the public officials, i.e. if they are the president, a minister or a civil servant. Also, there is a distinction between “bribery” and “extortion”. In bribery, the direction of influence moves from society to state, while in extortion it is the opposite way. (Morris, 2011)

Generally, the theories of corruption differ in means of whether they focus on the corrupt behaviour or on the structural environment of the emergence of corruption. In the first category can be included the organizational cultural theory, public choice theory, the principle-agent-client theory (Klitgaard, 1988). In the second – the theory of corruption and trust (Morris and Klesner, 2010) and the one of legal and illegal corruption (Kaufmann and Vicente, 2011). The “grease-the-wheels” theory of corruption is one of the few which emphasises the positive effects of corruption.

The situation in Bulgaria

For a very long period of time Bulgaria has been perceived as a country where corruption prospers. “Corruption has deterred foreign investment since communism collapsed in Bulgaria in 1989” writes Krasimirov (2018). The country has a history of being dominated by empires – the Roman Empire, The Ottoman Empire and most recently the Soviet Union, which influenced the development of national traditions, behaviour and ways of thinking. Littlehale argues that “[t]he faulty legal systems that these empires supported set the stage for corruption in Bulgaria’s current legal system” (2012, p.19). The post-communist country was struggling to get into the EU because of its problem with corruption in the private and public sector. “Since the beginning of the transition in 1989, Bulgaria has been in a spiral of deep political, social and economic malaise” (Nikolov et al., 2013). It is the only case where the conditionality that the EU posed was extended after the country became part of the Union in 2007. Almost a decade later Bulgaria is “the most corrupt country in the EU” according to Transparency International (2016). It ranks in seventy-fifth place in the Corruption Perception Index 2016, which compared with previous years is way worse – it has fallen more than thirty places lower since 2012. According to the European Commission’s report on the progress of Bulgaria under the Co-operation and Verification Mechanism “Bulgaria consistently ranks among the EU Member States with the highest perceived level of corruption” (EC, 2016, p.7). The judiciary in Bulgaria is the sector with the most urgent need of tackle the problem of corruption because it affects the private business, human rights and foreign investment. Judicial corruption occurs when there is a misconduct of the judges, i.e. they receive bribes, favours and so on in exchange for their cooperation on a matter in the court. “And the judiciary is one of the least trusted institutions in Bulgaria, due in part to the fact that many of the high-profile corruption cases that do make it to court result in non-guilty verdicts” (EC, 2016, p.28).  Progress in fighting corruption, however, seems to have been made according to the European Commission’s report in November 2017. Seventeen recommendations have been issued by the Commission in January 2017 concerned with judicial reform and tackling corruption in the country. Despite the fact that progress is slower than it was expected, the report shows that some steps are being taken towards the final aim by both the government and the judiciary.

Theoretical Approaches

This project relies on Organisational cultural theory, Public choice theory, the principle-agent theory, the theory of corruption and trust to investigate the factors of corruption. Organisational cultural theory assumes that a society with a certain culture leads to certain mental state, which lead to corrupt behavior. “Failure in the “proper machinery” of government, not faulty character, leads public officials to act corruptly” (De Graaf, p.51). Institutions influence how people think and act. If an organization, for example an NGO, a local or central government, behave in a corrupt way, there is a possibility that people involved in it will start to do the same. As Klitgaard (1988) states, corruption can spread like a disease once an organizational culture is corrupted. Organizational cultural theory stresses the fact that corruption could be more than a single act of misuse of power but it could be seen as a process. It may become an institutionalized misbehaviour, which in turn later becomes normalized and legitimized. This is what Ashforth and Anand (2003) call a “culture of corruption”.

Public choice theory presupposes that a rationally thinking individual will act corruptly for personal gain if the benefits of the action are bigger than the costs. This theory focuses on individual level, i.e. the individual choses cautiously and rationally what to do. Klitgaard (1988, p.70) claims that an individual will act corruptly if the potential benefits of doing so are greater than being caught. This is called the principle-agent formula where the principle is the people or the client and the agent is the government official. When the agent has the authority to allocate the resources of the principle, there is a chance of corruption because of different self-interests (Kiltgaard, 1988, p.24).

Corruption is connected with the levels of trust in the government. Morris and Klesner (2010) argue there is a mutual causality between trust and corruption in a country. On the one hand, when there is little trust in the government, corruption is more likely to emerge, on the other hand, if there are perceptions of corruption in the public realm, this affect the levels of trust in the public officials.

Additionally, Kaufmann and Vicente (2011) adopt a theory about “legal” and “illegal” corruption. Legal corruption takes place when the public officials develop a legal framework to protect their corrupt misbehavior, while illegal corruption lacks this framework (p.199). Public officials will turn to illegal corruption when there is low possibility of unrest or the costs of unrest are small due to the fact that there is high inequality and low income in the population. On the contrary, legal corruption will be the outcome when equality and high income are present and the cost of unrest is high. In both cases rationality plays a role.

This project departs from Leff’s (1964) “grease-the-wheels” theory which claims that corruption, and bribery in particular, can be beneficial as it efficiently allocates scarce resources in an otherwise bureaucratic system. Corruption is not beneficial because it steals from public resources and this in the long run affects economic stability. As Kaufmann notes “by focusing solely on bribery, this argument fails to take into account that corruption represents a theft of public resources” (1997, p.117). It harms a third party that does not even participate in the act.

Methodology

To demonstrate that corruption in Bulgaria, in particular judicial corruption, has increased since it joined the EU the project relies on a quantitative method of analysis. The quantitative research method, specifically the correlational research design, is the better option for two reasons. First, because the population of a whole country will be referred to, and second, because the aim is to prove that in Bulgaria there are extraneous variables that affect the relationship between EU policies and corruption, like deep tradition of corruption and so on, and which influence the implementation and effect of the EU policies in the country, while the same policies are working in countries where those extraneous variables are missing.

Quantitative method of research uses numerical data, for example from surveys and observations. The data in this research proposal will be gathered from Transparency International’ Corruption Perception Index for the period 2004-2016, in order to grasp the levels of corruption before and after Bulgaria joined the EU and from the Global Corruption Barometer. Another source will be The Centre for the Study for Democracy’s reports on corruption and anti-corruption measures for the years after 2007. Also, the annual EC reports of corruption in Bulgaria will be considered. Cross-sectional survey on popular opinion about levels of corruption in the country and about trust in the judicial system will be conducted in a short period of time and the data will be quantified. After that the data will be analysed using multiple regression because it allows for the examination of all determinants and enables the showing that corruption is caused. Then, during the interpretation process it will become clear how has the level of corruption changed and what are the reasons for it. Because the data gathered about corruption and trust in the judicial system in the country is sensitive, the participants in the survey will be protected by the offered anonymity of their answers.

Timeline

The timeline drawn in this section represents the amount of time and the order of the steps that will be undertaken to conduct the research. It will take one year to finish the research.

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Implications

This section presents the main objectives, contributions and shortcomings of this paper. First, this research project will outline the reasons why corruption is still a problem in Bulgaria, a decade after it joined the EU. The findings of the research will be useful for further research on the topic. The research can also assist in developing other tools for fighting corruption and consequently in amending policies in order to prevent further corruption practices.

Shortcomings of the methodology approach is that the data collected may be influenced by the political elite and may not fully reflect the social and political reality. Another shortcoming is the fact that answers to survey questions are usually subjective. However, the quantitative method of analysis is the most suitable one for this type of research.

 

Bibliography

Ashforth, B. E., & Anand, V., 2003. The Normalization of Corruption in Organizations. Research in Organizational Behavior, 25, pp.1-52. DOI: 10.1016/S0191-3085(03)25001-2

Centre for the Study of Democracy, 2010, Civil Society in Bulgaria: Trends and Risks: 1. Non-Governmental Organizations After 1989, Fig.1 Trends in NGOs registration [online], Publisher: Centre for the Study of Democracy. Available from: http://www.csd.bg/artShow.php?id=15423  [Accessed 03/01/2018]

European Commission, 2016. Report form the Commission to the European Parliament and the Council on Progress in Bulgaria under the Co-operation and Verification mechanism. Brussels: the European Commission (COM (2016) 40 final).

European Commission, 2016. Stock-taking of administrative capacity, systems and practices across the EU to ensure the compliance and quality of public procurement involving European Structural and Investment (ESI) Funds. Luxemburg: Publications Office of the European Union.

European Commission, 2017, Report form the Commission to the European Parliament and the Council on Progress in Bulgaria under the Co-operation and Verification mechanism, Brussels: the European Commission (COM (2017) 43 final). https://ec.europa.eu/info/sites/info/files/com-2017-43_en.pdf

Kaufmann, D., 1997. Corruption: The Facts. Foreign Policy, No. 107, pp. 114-131 Published by: Washingtonpost. Newsweek Interactive, LLC.

Klitgaard, R., 1988. Controlling Corruption. Berkeley: University of California Press.

Krasimorov, A., 2018. Bulgaria president vetoes anti-corruption law [online]. Ed. By Heinrich, M.  Available from: https://www.reuters.com/article/us-bulgaria-politics/bulgaria-president-vetoes-anti-corruption-law-idUSKBN1ER0S9 [Accessed on 02/01/2018]

Leff, N. H., 1964. Economic Development Through Bureaucratic Corruption. American Behavioural Scientist, Vol 8 (3), pp.8-14.

Littlehale, S. A., 2012. A Study of Corruption in the Bulgarian Legal System. Honors College. Paper 66.

Morris, S. D., 2011. Forms of Corruption. Munich: Ifo Institute for Economic Research, Report 9 (2), pp. 10-14.

Morris, S. D. and Klesner, J. L., 2010. Corruption and Trust: Theoretical Considerations and Evidence from Mexico. Comparative Political Studies, 43 (10), pp. 1258– 1285.

Nikolov, N., Kurzydlowski, D.H., Merkova, S., Simenonova, T., 2013, Bulgaria: lost in transition [online], Publisher: Open Democracy, Available from: https://www.opendemocracy.net/can-europe-make-it/nikolay-nikolov-dessislava-hristova-kurzydlowski-sonya-merkova-tanya-simeonova/bu  [Accessed 01/01/2018]

OECD, 2003. Annual Report on the OECD guidelines for multinational enterprises 2003 enhancing the role of business in the fight against corruption: Enhancing the role of business in the fight against corruption. Paris: OECD.

Transparency International, 2009. The anti-corruption plain language guide [Online]. Available from: http://issuu.com/transparencyinternational/docs/ti_plain_language_guide?e=2496456/2028282 [Accessed on 02/01/2018]

Transparency International, 2016, Corruption Perception Index 2016, Table of results [online], Publisher: Transparency International, Available from: https://www.transparency.org/news/feature/corruption_perceptions_index_2016?gclid=Cj0KCQiA4bzSBRDOARIsAHJ1UO5k8aJk8SUrdMxFa2bAJVhDxwibE0BY-92X3Ov2bRDAh8vFBW2TuMMaAg3qEALw_wcB  [Accessed on 02/02/2018]

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