Compound Democracy and the Control of Corruption: A Cross-Country Investigation Alok K. Bohara, Neil J. Mitchell, and Carl F. Mittendorff In this article we evaluate the influence of democracy on perceived levels of corruption. We argue that the control of corruption depends on the compensation and accountability of public officials, and on an open and competitive economy. We analyze the influence of democracy, controlling for the influ- ence of other political and economic factors including federalism, economic development, and economic competition. The findings for the importance of economic factors are consistent. The finding in earlier research that federalism increases corruption is not robust. The findings for democracy are influenced importantly by the way that democracy is measured, but we do find that citizens’ repetitive partici- pation in competitive elections increases the control of corruption. In doing so, we move beyond the composite indices of democracy in constructing an alternative compound measure of democracy, which we argue is likely to be useful in other research contexts Does democracy reduce corruption as well as contribute to international peace, to the observance of human rights, and to commitments to the environment (Davenport, 1999; Neumayer, 2002; Poe & Tate, 1994; Russett & Oneal, 2001)? The use of public office for private gain is as old as the creation of institutions and the practice of rule making and enforcement, but it is encouraged or inhibited in differ- ent institutional environments and at different levels of development. In poor coun- tries, corruption may represent a “survival strategy” (Rose-Ackerman, 1999, 72) for individual agents but with tragic outcomes for the collective. In creating inefficien- cies in aid allocation, corruption even inhibits others from coming to a country’s aid. Beyond economic variables, notably income levels and remuneration, a general theme in the theoretical work on corruption is the importance of market competi- tion and restraints on the power of public officials, principally democracy and fed- eralism, rather than an emphasis on moral and cultural differences (Bardhan, 1997; Heywood, 1997; Rose-Ackerman, 1978, 1999). Despite the theoretical and policy sig- nificance of corruption, data and measurement challenges created a lag in efforts to analyze systematically the incidence of corruption. In this article we examine how politics and economics structure the incentives for corrupt behavior at the level of the nation state. Complementing the analysis of the influence of market structure and competition, we focus on the bribe takers and the influences of political struc- ture and accountability on their behavior (Ades & Di Tella, 1999; Montinola & 0162-895X © 2004 The Policy Studies Journal Published by Blackwell Publishing. Inc., 350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford, OX4 2DQ. 481 The Policy Studies Journal, Vol. 32, No. 4, 2004