Approaches to the control of corruption in the public procurement system in Kenya : an institutional analysis

The problem with the populist approach to the question of corruption that focuses on micro-institutional changes is that it regards corruption as a top-down incentive-design problem. This approach, which is informed by the principal-agent theory, emphasises the need to restrain bureaucrats and politicians by changing incentive structures. This entails dealing with institutional factors that affect the decisions of individuals through compliance-enhancing policy measures. One of the problems with this approach is that it focuses on formal institutions whereas in reality, public officials respond to a mix of formal and informal constraints. Hence, comprehending corruption and its causes requires going beyond analysing the functioning of formal institutions that structure individual behaviour and constrain their decision-making preferences, to evaluating the complex network of informal institutions so as to gain a better understanding of the incentives driving individual behaviour. This thesis argues that the best way to conceptualise the problem of corruption is as a process in socio-economic and political development that is more than a problem of individual morality or market imperfections. Consequently, it is argued that by analysing corruption as part of a broader process in a society's socio-economic structure, societal power relations that sustain the process and the institutions that have been internalised can be better understood, thus leading to more effective anti-corruption strategies. In order to address the theoretical gap and explain the potential impact of formal institutions in constraining corruption or the role of informal institutions in the persistence of corruption, this thesis broadens the institutional analysis to include both formal and informal institutions.