Committed to Reciprocate on a Bribe or Blow the Whistle: The Effects of Periodical Staff-Rotation in Public Administration

Periodic rotation of staff in public administration may lead to lower corruption, as it disrupts long-term relationships between public officials and potential bribers. We use an experimental design to test the anti-corruption effect of staff rotation in situations in which public officials have committed to reciprocating bribes. We find that staff rotation does not influence the proportion of firms offering bribes but reduces the share of bribe acceptance and inefficient decisions due to bribery. The outcome of the staff rotation treatment, in which firms offered bribes even though they were rarely accepted by officials, is consistent with the game having a quantal response equilibrium.