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Corruption and public service motivation: Evidence from South Korea
Hyunkuk Lee, JungHo Park, Tobin Im, Jesse W. Campbell
Abstract:
This study examines alternative theoretical models of individual corruption in public
organizations. Based on the rational actor model, it is proposed that public servants may exploit
their advantageous position vis-à-vis their public and political principles for personal gain to the
extent that they are unsatisfied with their pay or perceive their workplace to be unfair in its
dealings with employees. Alternatively, this study also examines the role of public service
motivation (PSM) in reducing corruption. Findings from an analysis based on a representative
survey of civil servants in South Korea suggest that PSM is both related to lower levels of
corruptibility, as well as potentially acts as a buffering mechanism against the effects of
dissatisfaction with pay on corrupt behavior. A discussion of the contribution of this study to
motivation theory in public organizations as well as its practical implications is provided.
Introduction
A great deal of literature has examined the theme of corruption based on its close relationship
with governmental transparency, economic growth, citizens’ trust and confidence in government
and performance, and effective policy implementation (Caiden & Caiden, 1977; Dean, 1977;
Klitgaard, 1997; Mo, 2001; Quah, 1999; Van Ryzin, 2011). Although there have been numerous
theoretical discussions about the root of corruption in the public sector, much emphasis has been
placed on social and institutional antecedents. As such, policy advice to reduce corruption often
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target factors “beyond the individual” by stressing the importance of cultural conditions and the
structure of organizations as the systematic drivers of corruption (de Graaf & Huberts, 2008). For
example, previous studies point to cultural characteristics, economic conditions, and civil service
systems as the primary antecedents of corruption. These explanations of corruption, which
emphasize the cultural and institutional context of corrupt acts, have resulted in cynicism with
regard to the possibility of establishing rigorous causal foundations that can serve as levers for
the reduction of corrupt behavior (Klitgaard, 1997; Rubin & Whitford, 2008; Segal, 2002).
This study takes a different approach to examining corruption in the public sector by focusing on
individual motivation. In particular, public service motivation (PSM), which captures an
individual’s prosocial and altruistic orientation and is generally understood as a predisposition to
respond to values uniquely grounded in public sector organizations (Perry and Wise, 1990), may
represent an alternative approach to corruption in the public sector that can provide insight into
how individual differences interact with organizational phenomena in order to moderate
intentions to act in organizationally deviant ways. PSM has been connected to a substantial
number of behaviors and attitudes recognized as valuable to public organizations (Houston, 2006;
Vandenabeele, 2009; Im, Campbell, and Jeong, 2013), and this study aims to further this
research by establishing a link between PSM and corruption and testing this link empirically.
This study proceeds as follow. We first review relevant theory in order to conceptualize the
potential link between PSM and corrupt behavior, and further discuss how PSM may provide a
rich and important direction in the study of corruption in the public sector. In addition, we
address other antecedents of corruption such as satisfaction with financial rewards and the
perception of organizational fairness. Based on this analysis, empirical hypotheses are proposed
and tested using data collected from public servants working in central government organizations
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in South Korea. This paper concludes with a theoretical discussion of the results of the analysis,
as well as the implications of this study for policy initiatives aimed at reducing public corruption.
Literature review
Corruption in the public sector
The notion of corruption has numerous meanings and definitions due to its multidimensional
nature and the complex processes underlying its occurrence (Alemann, 2004; Ashforth, Gioia,
Robinson, & Treviño, 2008; de Graaf & Huberts, 2008; Klitgaard, 1988; Kurer, 2005; Rose-
Ackerman, 1999). One of most widely cited definitions of corruption conceptualizes the
phenomenon as individual behavior “which deviates from the formal duties of a public role
because of private-regarding (personal, close family, private clique) pecuniary or status-gains; or
violates rules against the exercise of certain types of private-regarding behavior” (Klitgaard,
1988, p. 23). This definition is not solely constrained to the public sector corruption, but is
broadly applicable to other social sectors. Specifically regarding the corruption of public officials,
de Graaf and Hubert (2008) write that “public officials are corrupt when they act (or fail to act)
as a result of receiving personal rewards from interested outside parties.”
In explaining how and why corruption arises in the public sector, Klitgaard (1988) suggests an
appealing explanation based on the principle-agent-client framework. In his distinguished
research, Klitgaard (1988) argues that public officials tend towards misconduct or to deviate
from the rules when an agent (i.e., a public servant) betrays their principal’s (i.e., the public’s)
interests for the purpose of achieving his or her own interest at the expense of principal’s
interests. Such behavior primarily arises due to the divergence or inconsistency of interest
between the principal and agent. Put simply, M. W. Collier (2002) states that corruption happens
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when public servants abuse the power vested in their public office for self-interest. These studies
commonly point out that public servants’ corruption, at the individual level, occurs when public
officials mobilize their discretion and power for the purpose of their own self-interest (e.g.,
social status or financial reward).
Previous literature has pointed to diverse antecedents of corruption (Beckers & Stigler, 1974;
Rauch & Evans, 2000; Rose-Ackerman, 1999; Rubin & Whitford, 2008; Van Rijckeghem &
Weder, 2001). In particular, as corrupt behavior is usually undertaken for personal gain, wage
levels and satisfaction with financial rewards have drawn extensive attention in the literature.
Very simply, the less satisfied public servants are with their financial rewards, the more likely
they may be to engage in corrupt acts in order to supplement their salary, often though accepting
bribes. Empirical evidence largely supports this theory. For instance, Van Rijckeghem and
Weder (2001), using cross national data, compared the wage level of civil servants with
employees in the manufacturing industries, and found that wage has an inverse relation to
corruption in both sectors. At its base, this driver of corruption is related to an absolute
evaluation of a given employee’s ratio of inputs (efforts, skills, etc.) to outputs (remuneration).
A second connection between satisfaction with financial rewards and corrupt behavior can be
found in classical equity theory (Adams, 1963). According to equity theory, individuals are
aware not only of their own ratio of input to output, but also that of other individuals. As such, in
addition to an absolute evaluation of personal utility, equity theory suggests that relative,
interpersonal evaluations of utility are also important (Akerlof and Yellen, 1990). In terms of
corrupt behavior, individuals who perceive that they are not well compensated relative to others
with comparable skills and work may take actions to close the gap. This can be done either
through reducing personal effort, or alternatively, engaging in corrupt behavior.
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Questions of equity are closely linked with broader views of organizational fairness. Particularly
with regard to treatment by management and organizational rewards, if individuals have an
ongoing sense that their organization is unfair, their sense of moral outrage may be dulled when
presented with the opportunity to engage in a corrupt act for personal gain (Rose-Ackerman,
1975). In this vein, Kurer (2005) also argues that corruption is fundamentally related to the
principle of impartiality, i.e. that “corruption is deeply rooted in perceived distributive justice
and therefore, that corruption emerges whenever there is a problem with the fairness of resource
distribution” (p.165). Put simply, public servants who perceive their rewards (i.e., wages and
promotion) are fairly based on their own performance may view their organization itself as fair
(Rauch & Evans, 2000). On the other hand, organizational fairness is not limited to questions of
distributive equity but is rather a general perception about the organization as such, and is closely
related to the concept of justice. These general perceptions of the organization can function as
cognitive heuristics that shape the decision to engage in various kinds of behavior, and
perceptions of fairness have been connected with various forms of employee misconduct
(Treviño and Weaver, 2001; De Schrijver et al., 2010).
Based on the above discussion, the following two hypotheses are proposed.
Hypothesis 1: Dissatisfaction with pay is positively related to corruption.
Hypothesis 2: Perceived unfair treatment is positively related to corruption.
The role of public service motivation
The two hypotheses proposed above are rooted in an understanding of human beings as
fundamentally motivated by self-interest and driven to maximize personal utility by exploiting
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their relative advantages in the principle-agent framework (Mahler & Regan, 2005; Mueller,
2003). In this framework, a public servant, as an agent, tends to take advantage of given
conditions (e.g., information asymmetry) to further their self-interest. This stream of thought has
served as a cornerstone for many ongoing government reform initiatives. From a popular
perspective, “extrinsic rewards and punishments are the primary sources of work motivation may
underlie the popular perception of the lazy bureaucrat” (Frank & Lewis, 2004, p. 39).
On the other hand, contrary to this view of public servants as purely “homo economicus”
(Andersen, 2009, p. 83), early theorists of public sector work motivation argue that public
servants instead place a high value of public service per se, and relatively less emphasis on
financial rewards (Rainey, 1983). Rainey (1983) specifically found that public servants value
“the meaning of work” and “engagement in public service” (p. 293) more than financial rewards,
drawing attention to a potentially distinguishing aspect of civil service careers and motivation. In
a similar vein, Frederickson and Hart (1985) asserted that significant reasons why people enter
the public service include feelings of patriotism and commitment to democratic values, as well as
a genuine love of the people.
The concept of PSM (Perry and Wise, 1990), defined as “an individual’s orientation to delivering
services to people with a purpose to do good for others and society” (Perry & Hondeghem, 2008,
p. vii), captures these tendencies. Empirically, PSM has been linked with a number of positive
organizational attitudes and behaviors, including organizational commitment (Ritz, 2009;
Vandenabeele, 2009; Im et al., 2013), organizational citizenship behavior (S. M. Kim, 2006;
Pandey, Wright, & Moynihan, 2008), individual performance (Leisink & Steijn, 2009;
Vandenabeele, 2009), turnover intention (Bright, 2008; Campbell, Im, and Jeong, 2014), job
satisfaction (Taylor, 2008; Vandenabeele, 2009), prosocial behavior (Houston, 2006), and
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whistle blowing (Brewer & Selden, 1998). Furthering these studies, this research links PSM with
reduced intentions to engage in corrupt behavior.
PSM is linked with placing a greater value on the meaning of public service per se as opposed to
financial rewards, and public interest than personal gains. More directly, Brewer and Selden
(1998) provide evidence that PSM has a substantial association with an important component of
public service ethics, namely, the tendency to report corruption. Rubin and Whitford (2008) also
emphasized the need for future research to address the relationship between individuals’ public
service motivation (PSM) and corruption, arguing that the constructs may be closely linked.
These considerations lead to the following hypothesis.
Hypothesis 3: PSM is negatively related to corruption.
In addition to this direct effect of PSM on corruption, however, this study also examines the
extent to which PSM may also act as a buffer against the effects of low satisfaction with pay and
the perception of unfairness on corruption. Firstly, in addition to less concern with extrinsic
rewards, PSM is closely connected with self-sacrifice (Perry and Wise 1990). As such, other
things being equal, higher levels of PSM may be associated with greater acceptance of low
wages. Alternatively, it may be the case that PSM driven employees also view low wages as
directly contributing to the public good by making better use of the public’s resources. In terms
of relative deprivation and perceived unfairness in the organization, while such factors may
affect employees with high levels of PSM a great deal, nevertheless PSM may motivate
employees to address these factors differently, such as through voice or, in the extreme case,
whistle blowing (Brewer & Selden, 1998), rather than engaging in corruption themselves.
Secondly and more generally, employees with higher levels of PSM have been connected with
higher levels of resiliency against potentially negative effects of many public bureaucracies, such
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as red tape (Scott and Pandey, 2005) and a strong emphasis on internal efficiency (Campbell et al.
2014).
The following two hypotheses are proposed.
Hypothesis 4: PSM negatively moderates the relationship between dissatisfaction with pay
and corruption such that at high levels of PSM, the relationship between dissatisfaction
with pay and corruption is weaker.
Hypothesis 5: PSM negatively moderates the relationship between perceived unfair
treatment and corruption such that at high levels of PSM, the relationship between
perceived unfair treatment and corruption is weaker.
Based on the principle-agent model of corruption as explained by Klitgaard (1988), this study
controls for both employee discretion and merit pay in order to test the hypotheses outlined
above. Discretion entails that civil servants may use their own judgment in place of formal
organizational policy in making decisions about how to allocate their time and resources. As
such, higher levels of discretion in the civil service may provide the opportunity to engage in
corrupt acts. Secondly, merit or performance based pay, along with increased discretion for
public servants, is a central tenant of New Public Management (NPM) reform initiatives (Hood
and Peters, 2004), and as such is a highly relevant construct for public organizations. Merit pay
may be important for the reduction of corruption as it provides civil servants with an alternative
and legitimate behavior, namely, increased effort, with which to counter the effects of
dissatisfaction with pay. Moreover, merit pay may also be closely connected with perceptions of
distributive equity, whose relationship to corruption has already been discussed.
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Data, research context, and measurements
Data
This research uses data from The Korean Civil Service Survey (KCSS), which was conducted by
the Knowledge Center for Public Administration & Policy at Seoul National University. The
survey was conducted between June 7, 2011 and July 18, 2011, and a total of 1,320 observations
were collected from public servants working in central government ministries. Quotas of 30, 40,
or 50 respondents were selected for departments based on their relative size, and respondents
from each department were selected randomly from employee lists. Surveys were administered
through face-to-face interviews by professionals from a survey company in Korea.
Corruption in South Korea's public service
South Korea’s challenges with and efforts to overcome corruption in government make the
country an interesting context in which to explore the propositions outlined in the previous
sections. Beginning in the 1960s, Korea embarked on a process of rapid industrial development
that has resulted in the transformation of the country from one of the world’s poorest to one of its
richest. This remarkable success, however, has came at a significant cost in terms of money
politics and corrupt government practices (Kang, 2002), and today the government continues to
battle corruption resulting from the close relationship between government and business that was
a key component of the state’s development strategy (Rho and Lee, 2010). For example, Korea’s
rank on both Transparency International’s Corruption Perception Index (CPI) as well as the
Bribe Payer Index (BPI) are low relative to other countries of comparable economic
development and sophistication (for example, Korea was ranked 22nd out of 30 members of
Organization for Economic Cooperation and Development (OECD) group in 2012). On the other
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hand, due to significant efforts to address corruption in government over the past decades,
consistent progress has been made to improve the situation (Lee & Jung, 2010). Korea’s current
strategy for reducing corruption in the public sector includes the founding of nationwide
anticorruption institutions such as the Anticorruption Act of 2001 and the establishment of the
Korea Independent Commission Against Corruption (KICAC), political and campaign finance
reforms, as well as a robust e-procurement system. In addition, various civil society
organizations as well as international organizations, such as the OECD, have also played a role.
Nevertheless, tendencies toward corruption are embedded deeply in Korea’s organizational and
social culture. For example, certain cultural traditions in Korea have often been abused as a way
of giving and taking bribes, particularly money gifts associated with social occasions such as
weddings and funerals. While systems such as Korea’s e-procurement framework have brought
significant transparency to a wide range of government transactions with the private sector, such
cultural institutions continue to provide cover for a range of corrupt behaviors (Ko & Cho, 2011).
This issue is addressed further in the following section dealing with the measurement of
corruption used in this study.
Measurements
Due to its sensitive and secretive nature, corruption is a difficult construct to measure. Generally
in the social sciences, objective measures are preferred to perceptual ones, however in the case of
corruption such data can only be collected in the case that corruption is uncovered, and therefore
should also be considered only an estimate of the true level of corruption in a given organization
or state. In this study, the likelihood of corruption is measured by focusing on public servants’
moral sensitivity to corrupt acts based on the assumption that the less morally sensitive public
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servants are towards acts of corruption, the more likely they will be to engage in them. This
‘slippery slope’ line of reasoning is a common approach in the literature on corruption (Degraff,
2008, p.644; Segal, 2002).
To measure the likelihood of corruption, survey participants were asked to rate how corrupt they
viewed different types of behavior to be. The 4 behaviors used were the following:
Accepting 100,000 won (about 100 USD) from a job-related company at your child’s
marriage ceremony.
Accepting a 100,000 won gift certificate from a job-related company.
Making a long distance phone call on an office phone for personal purposes.
Being absent from work for personal purposes.
Officials responded based on a Likert scale ranging from 1 to 5 with 1 representing “It is not
corrupt at all” and 5 representing “It is very corrupt.” To calculate the likelihood of corruption, 5,
which represents perceptions of obvious corruption, was transferred to zero as we assume that
respondents who choose 5 have a very small possibility of corrupt behavior. A value of 1, which
indicates that the respondent judges the act to be completely non-corrupt, is transferred to 100,
again on the assumption that respondents who choose 5 have high a possibility of corrupt
behavior. After these transfers, responses across the 4 questions were averaged to produce a
likelihood of corruption scale ranging from 0 to 100. The scale was found to be internally
consistent, with a Cronbach’s alpha coefficient of .818.
This measure of corruption is particularly suited for the Korean context. As Kwon (2012) notes,
accepting 100,000 won from a job-related company, understood as a business that stands to
benefit from the implementation of favorable regulation or subsidies, is considered formally to
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be corrupt behavior. The second two questions do not measure formally corrupt behavior as
defined by the Public Service Ethics Law (am I right here?). However, they do represent a type
of breach of trust on the part of public servants. While these questions moreover do not address
large-scale corruption, however, the types of petty corruption captured by the items are
applicable for civil servants at all levels.
Dissatisfaction with pay and perceived unfair treatment were each measured with a single item,
both of which were reverse coded: “I am satisfied with my pay” and “This organization treats all
employees fairly.” In order to measure relatively complex constructs such as satisfaction and
perceived fairness (Heneman and Schwab, 1985; Colquitt, 2001), multi-item measurements are
generally preferred. As such, the use of single item measures for critical variables in this study
represents one of its limitations. That said, both questions are unambiguously worded, and each
has a high face validity for the respective concept being measured. Respondents answered on a
5-point Likert scale which was reverse coded from 1 (strongly agree) to 5 (strongly disagree).
Thus, higher values are associated with greater levels of dissatisfaction with pay and higher
perceived unfair treatment.
Public service motivation is measured by 5 items based on Perry’s (1997) 24-item scale. The
items are drawn from three core dimensions of PSM: commitment to the public interest,
compassion, and self-sacrifice. The following questions were used: “I consider public service my
civic duty,” “Meaningful public service is very important to me,” “Most social programs are too
vital to do without,” “I am one of those people who would risk personal loss to help someone
else,” and “Making a difference in society means more to me than personal achievements.”
The final composite scale ranges was created by averaging answers across the five questions, and
thus runs from 1 (low PSM) to 5 (high PSM). Cronbach’s alpha for the PSM scale was .863.
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Both merit pay and discretion were each measured using a single question, “In my organization,
pay is based on employee performance” and “In my organization, employees have significant
discretion in performing their jobs.” Again, these single item measurements potentially represent
limitations for this research, though the caveats offered above in relation to dissatisfaction with
pay and perceived organizational fairness may also apply in this case.
A number of demographic controls are also included in our model of corruption likelihood,
including civil service grade, organizational tenure, sex, and age. Demographic factors have in
some cases been linked to misbehavior at work (De Schrijver et al. 2010), and as such may bias
estimates of the variables of interest if omitted from the model.
Findings
Descriptive statistics and correlations
Table 1 presents the descriptive statistics for the variables used in this study. The likelihood of
corruption scale ranges 0 to 100 and has a mean value of 36.7. This statistic is below the scale
midpoint, and suggests that public servants are not excessively insensitive to corrupt behavior.
Table 1: Summary statistics
[Table 1 about here]
PSM shows a mean value of 3.5, which is above the scale midpoint, suggesting that public
servants are significantly motivated by intrinsic concerns. Dissatisfaction with pay, however, is
also above the scale midpoint, with a mean value of 3.2. Encouragingly, unfair treatment, on the
other hand, has a mean value below the scale midpoint at 2.4.
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Table 2 shows inter-construct zero-order correlations. As can be seen, PSM is negatively related
to the likelihood of corruption, which is consistent with the hypothesis proposed in this study.
Moreover, both dissatisfaction with pay and unfair treatment are positively associated with
corruption, also in line with the hypotheses presented above. Merit pay is also negatively related
to the likelihood of corruption, while discretion shows no statistically significant relationship. Of
the demographic controls, both age and organizational tenure show negative relationships with
the dependent variable.
Table 2: Zero-order correlations
[Table 2 about here]
Principle findings
Table 3 displays the results of the principle analysis of this study. Model 1 shows the direct
effects of PSM, dissatisfaction with pay, unfair treatment, and control variables and the
likelihood of corruption. Both dissatisfaction with pay and perceived unfair treatment show
statistically significant, positive relationships with the dependent variable (1.317 p < .05 and
2.067 p < .01, respectively). These findings provide support for hypotheses 1 and 2 of this study
which stated that dissatisfaction with pay and unfair treatment are associated with a higher
likelihood of corruption in public organizations. Hypothesis 3 stated that PSM would be
negatively associated with the likelihood of corruption. The findings of model 1 again provide
support for this hypothesis. Of the 3 main variables of interest in study, moreover, PSM was
found to have the strongest effect, with a regression coefficient of -6.484 (p < .001). Merit pay
was also found to be negatively related to the likelihood of corruption, while employee discretion
was not found to have any statistically significant effect.
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Table 3: Regression analysis
[Table 3 about here]
Of the demographic control variables, only sex appears to be related to the likelihood of
corruption in Korean public organizations. The results suggest that females have a significantly
stronger moral sensitivity to corruption and thereby may be less likely to engage in corrupt acts.
Indeed, the strength of sex in the model is second only to the effect of PSM with the regression
coefficient -4.625 (p < .001).
To test for the moderating effects of PSM on dissatisfaction with paid and unfair treatment,
procedures outlined by a number of prominent methodologists were followed (Aiken & West,
1991; Cohen & Cohen, 1983; Simons & Peterson, 2000). First, interaction variables were created
by taking the product of PSM and both dissatisfaction with pay and unfair treatment, respectively.
Secondly, these variables were added to the model in a hierarchical fashion, which reduces
multicollinearity problems resulting from the use of multiplicative terms. The results of this
analysis are displayed in the table 1 under the heading Model 2.
Hypothesis 4 stated that PSM would negatively moderate the relationship between dissatisfaction
with pay and the likelihood of corruption. The results of the analysis suggest support for this
hypothesis based on the negative and statistically significant coefficient of the interaction term.
Similarly, hypothesis 5 stated that PSM would also negatively moderate the effect of perceived
unfair treatment on the likelihood of corruption. However, while the interaction term in the
model is statistically significant, it is positive rather than negative, which suggests that the
hypothesis should be rejected.
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To further aid in the interpretation of the results, the interactions uncovered in model 2 were
graphed. The graphs show the slope of the relationship between the independent variable of
interest and the likelihood of corruption at high and low levels of PSM (1 standard deviation
above and below the mean, respectively) while holding all other independent variables constant
at their means. The first graph shows the relationship between dissatisfaction with pay and the
dependent variable at the specified levels of PSM. As can be seen in the graph, at low levels of
PSM the relationship between dissatisfaction with pay and corruption is positive. In other words,
employees who report low levels of PSM are more likely to engage in corrupt behavior to the
extent that they are also dissatisfied with their pay (hypothesis 4). The second graph tells a
different story. Here, at low levels of PSM the slope of the relationship between perceived
unfairness and the likelihood of corruption is close to zero. This suggests that employees with
low levels of PSM are not more likely to engage in corrupt behavior as perception of unfairness
increases. On the other hand, perceived organizational unfairness does appear to be an operative
factor determining corrupt behavior for employees who report high levels of PSM. This finding
is consistent with the results displayed in table 3, and is against hypothesis 5 of this study. The
next section provides a discussion of these results and offers some interpretations of this
interesting finding.
Figure 1: Moderation graphs
[Figure 1 about here]
Discussion: Reducing the likelihood of corruption in public organizations
Corruption in the public sector negatively impacts organizations performance and trust in
government. This study explored the effects of a number of employee level perceptions on the
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likelihood of corruption on the part of public servants. While many of the causes of corruption
are systemic, nevertheless it is individual public servants who engage in corrupt acts (Caiden &
Caiden, 1977), and as such understanding the empirical antecedents of corrupt behavior is an
important task for public administration research. Based on the rational actor model, it is argued
that public servants tend to exploit opportunities to increase their own interest when
environmental conditions are favorable to do so (Palmier, 1985). As such, many government
agencies have attempted to reduce corruption by designing new legal and institutional devices,
providing the specified administrative procedures and criteria for corruption, and spending more
resources on monitoring and policing for corruption. However, public servants may become
skilled at meeting these formal criteria, which may moreover be irrelevant in different situations,
or lab behind changing social and environmental conditions (c.f., Segal’s inaction case) (Zajac,
1996). For example, Segal’s case study (2002) suggests that even with stricter policy measures
for corruption—replacing public personnel, providing reporting and multiples processes of
auditing systems—individuals can elude such efforts by taking numerous strategic approaches
(i.e., co-optation, coalition). As such, relying solely on external policing and punishing to
eliminate corruption in the public sector has significant limitations.
Given that external controls for corruption cannot eliminate entirely opportunities for engaging
in corrupt behavior, examining factors which increase the likelihood that public servants will
engage in corrupt acts is an important research task. This study hypothesized that both
dissatisfaction with pay and perceived organizational unfairness would be positively related to
the likelihood of corruption, hypotheses which the empirical analysis support. The links between
satisfaction with pay, organizational fairness and corruption are well documented in the extant
literature, and this study provides additional evidence of their importance. Employees who are
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unsatisfied with their pay may perceive a gap between their worth and their rewards, and as such
may take action to close this gap, either through reducing their effort or attempting to supplement
their pay through corrupt acts. This intuitive link, moreover, has been recognized by various
public sectors around the world (for example, in Singapore), and has resulted in attempts to bring
public sector pay in line with that of the private sector. Closing the gap between public and
private sector pay has also been a goal of public sector reform in Korea, which has also
introduced various performance-based incentives designed to encourage civil servants to apply
themselves fully (Park and Joo, 2010). The findings of this study lend weight to the arguments
that such measures may be effective reducing corruption.
This study also found a positive relationship between perceived organizational unfairness and the
likelihood of corruption. While perceived unfairness may be closely related to dissatisfaction
with pay, nevertheless unfairness captures a broader concept which may be related not only to
distributive but also other kinds of organizational justice, such as having sound and fair
procedures to resolve conflicts between employees and management. This study argued that
employees who perceive that they are treated unfairly by their organizations may be more
susceptible to corrupt acts, feeling that their loyalty to and effort on behalf of the organization
are not reciprocated. While these underlying mechanisms were not directly tested in this study
and thus remain for future research, nevertheless the results of the analysis suggest that efforts to
improve perceptions of fairness in public organizations may reduce employee intentions to
engage in corrupt behavior. This is an important result, as it represents a managerial mechanism
which may be employed with relatively less resistance than increasing employee pay. As such,
the practical implications of this findings are highly relevant for public managers.
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The role of public service motivation
In addition to dissatisfaction with pay and perceived unfairness, this study also tested whether
higher levels of PSM are associated with reduced likelihood of corrupt behavior. The results of
the analysis largely support this contention. In past studies, PSM has been connected with a wide
variety of positive dispositions and behaviors in public organizations, including a higher
likelihood to report corruption (Brewer and Selden 1998). PSM is associated with self-sacrifice
and a high level of commitment to the goals of public organizations (Perry and Wise, 1990), as
well as stronger belief in mission valence (Wright, Moynihan, and Pandey, 2012). This study
also suggested that PSM may also be associated with a greater acceptance of low pay based on
the perception that reduced compensation may contribute directly to the public good by freeing
up funds for more important purposes. This finding alone represents a significant contribution to
the public sector literature focusing on organizational behavior, and potentially points to
important practical implications in the reduction of corruption.
In addition to this direct effect, however, this study also examined whether PSM could act as a
buffering mechanism against negative job perceptions. The results of the analysis provide mixed
support for these hypotheses. On the one hand, as hypothesized, PSM was found to have a
negative moderating effect on the relationship between dissatisfaction with pay and the
likelihood of corruption. The positive attitudes of high-level PSM employees, such as self-
sacrifice, may encourage them to maintain a high level of work motivation as well as an ethical
outlook even in instances where they feel they are being compensated materially below their
worth. In contrast to the rational actor model of organizational behavior, moreover, it may be the
case that, due to this intrinsic motivation, employees motivated strongly by PSM may also have
stronger internal regulations which protect them from temptations to engage in corrupt behavior
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in the absence of external controls. Scholars have also argued that PSM is associated with
resilience in the face of the type of bureaucratic characteristics associated with public
organizations (Scott and Pandey, 2005). This finding extends this research by linking PSM with
relatively lower intentions to engage in highly damaging type of organizational behavior.
Based on a similar line of argument, this study also tested whether PSM reduced intentions to
engage in corrupt behavior in organizations with higher levels of perceived unfairness. In this
case, however, the results of the analysis did not confirm the hypothesis. Surprisingly, higher
levels of PSM were associated with a greater likelihood of corruption in cases where
organizations were perceived to be less fair. In contrast to satisfaction with pay, perceived
organizational unfairness relates to a more general perception about the organization and how it
treats its members. While levels of satisfaction with pay appear to be unrelated to the likelihood
of high level PSM employees to engage in corrupt acts, these same employees may be more
sensitive to general evaluations of justice. Given the strong public-orientation of employees
motivated by PSM, this result may not be as remarkable as it first appears. In any case, the
results suggest that perceived fairness in public organizations may have an important relationship
with PSM which may be explored in future studies. Unfortunately, doing so to any satisfactory
degree is beyond the scope of this research.
Conclusion
This study tested a number of empirical hypotheses related to the likelihood of corruption in
public organizations. The findings indicate that PSM is not only related to lower levels of
corruption, but also that it may act as a buffering mechanism against the effects of low
satisfaction with pay. This finding extends the theory of PSM, as well as further underscoring the
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practical importance of cultivating intrinsically motivated employees in the public sector.
Against our expectations, however, the analysis also suggests that PSM may be associated with a
higher likelihood of corruption in organizations that are perceived to be unfair by employees
with high levels of PSM. This higher sensitivity to the ethical climate of public organizations is
in line with the public-oriented dimensions of PSM, though further study is needed in order to
fully understand this result.
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Tables and figures
Table 1: Summary statistics
Variable Mean SD Min Max
Likelihood of corruption 36.7 18.9 0 100
Public Service Motivation (PSM) 3.5 0.6 1 5
Dissatisfaction with pay 3.2 0.9 1 5
Unfair treatment 2.4 0.8 1 5
Merit
pay 2.7 0.9 1 5Discretion 3.0 0.7 1 5
Service grade 4.3 1.3 1 7
Organizational tenure 13.8 8.5 0.1 40.3
Female 0.3 0.4 0 1
Age 40.4 7.4 23 59
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Table 2: Zero-order correlations
1 2 3 4
1 Likelihood of corruption
2 Public Service Motivation (PSM) -.240***
3 Dissatisfaction with pay .138*** -.247***
4 Unfair treatment .172*** -.335*** .252***
5 Merit pay -.143*** .246*** -.205*** -.201***
6 Discretion -.040 .166*** -.163*** -.214***
7 Service grade -.025 .174*** -.059* -.015
8 Organizational
tenure
-.049
.252***
-.252***
-.071*
9 Female -.018 -.247*** .032 .114***
10 Age -.069* .293*** -.220*** -.081**
6 7 8 9
7 Service grade .053
8 Organizational tenure -.064* .357***
9 Female -.003 -.299*** -.226***
10 Age
-.018
.473***
.877***
-.362***
* p<0.05, ** p<0.01, *** p<0.001
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Table 3: Regression analysis
Model
1:
Without
interactions Model
2:
With
interactions
Dissatisfaction with pay 1.317 (0.637)* 8.505 (3.491)*
Unfair treatment 2.067 (0.662)** -7.854 (3.417)*
Public Service Motivation (PSM) -6.484 (0.983)*** -6.836 (3.285)*
PSM x Dissatisfaction with pay -2.035 (0.956)*
PSM x Unfair treatment 2.860 (0.963)**
Merit pay -1.795 (0.597)** -1.747 (0.596)**
Discretion
1.197
(0.737)
1.161
(0.735)
Service grade 0.246 (0.463) 0.218 (0.462)
Tenure 0.240 (0.130) 0.236 (0.130)
Female -4.625 (1.305)*** -4.633 (1.301)***
Age -0.299 (0.160) -0.290 (0.160)
Intercept 60.428 (6.880)*** 61.239 (13.245)***
R-squared .088 .095
Adj.
R-squared .081 .087
N 1281 1281
* p<0.05, ** p<0.01, *** p<0.001
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Figure 1: Moderation graphs