Why is it that, for a country which is experiencing record-breaking economic growth with nascent super power aspirations, we have been so unsuccessful in tackling corruption? As the recent World Bank investigation on health care projects reported in this newspaper reveals, the malaise of corruption pervades through our governance structures. India ranks 108th out of 205 countries on the World Bank’s control of corruption index. According to Transparency International, Indians spend over Rs 210 billion annually on corruption.

Understanding why requires an analysis of the current market for corruption. As in any market demand (the bribe-taker) and supply (the complicit bribe-giver) operate in tandem. Much of the focus has been on the demand side and we are all familiar with these arguments. The need of the day is radical administrative reform. But this requires strong political will, which is conspicuous by its absence.

This brings us to the second and relatively under-discussed aspect of the market for corruption — its supply side. Is it not extraordinary that in an effective, well functioning electoral democracy, corruption has almost never been a significant electoral issue at any level — national, state or local Panchayat?

Some answers to this puzzle can be found in an analysis of the supply side of corruption. For this, we need to make a distinction between the different experiences of corruption across sections of society.

Failures of collective action are an outcome of these distinct ways in which corruption is experienced and responses are framed.

... contd.