DEMS Economics Seminar: Henrik Sigstad (BI Norwegian Business School)

The DEMS Economics Seminar series is proud to host   

ABSTRACT

To what extent are politicians held legally responsible for corruption? We find that random audits discovering evidence of corruption in Brazilian municipalities increase indictments of mayors by 25–40%. The effect increases with the number of irregularities discovered in the audit and spills over into neighboring municipalities. Audits also increase the trial court conviction rate both in new and ongoing cases. We exploit textual similarities between court documents and audit reports to identify the audit findings leading to legal consequences. Following audit-induced court cases across four court instances, however, we find that 97% of the cases have—20 years after the audit—not led to any formal punishment of the audited mayors. Most of the cases are still pending appeals. The 3% final convictions are almost exclusively modest fines. While some ex-mayors are barred from running in future elections, this happens long after they have retired from politics. Exploiting detailed case data, we identify sources of judicial delay, document abuses of legal procedures, and generate recommendations for court reform.

The seminar will be in presence, Seminar Room 2104, Building U7-2nd floor