This document analyzes the relationship between perceptions of corruption in Armenia and three institutional sources: formal rules, informal rules, and enforcement mechanisms. Statistical models show perceptions of enforcement mechanisms and informal rules significantly correlate with perceived corruption, but not formal rules. Higher education levels also correlate with higher perceived corruption. The document recommends reforms like transparency laws and judicial reforms to strengthen enforcement mechanisms to reduce corruption by impacting informal norms.

1. Caucasus Research Resource Centers - ARMENIA A Program of Eurasia Partnership Foundation INSTITUTIONAL SOURCES OF CORRUPTION IN THE CASE OF ARMENIA: IS IT RULES, BLOOD AND CULTURE, OR PUNISHMENT? Anna Martirosyan Yerevan, August 14, 2009

2. CORRUPTION Definitions and Measurements Causes and Consequences THE POLITICS OF INSTITUTIONAL CHOICE: THE CASE OF AREMNIA Formal Rules and Corruption Informal Rules and Corruption Enforcement Mechanisms and Corruption METHODOLOGY, DATA, SOURCES RESULTS, RECOMMENDATIONS, CONCLUSION

29. Significance level: ** - p<0.01; * - p<0.05; † - p<0.1 . Model 1 Model 2 Intercept 6.89** 4.21** Perception of formal rules Knows what institutions to contact to report a corrupt act 1.03 0.93 Agrees that NGOs are capable of combating corruption in Armenia 1.32 1.39 Is aware of anti-corruption measures taken by the Government of Armenia 0.95 0.85 Is aware of the Anti-Corruption Strategy and Action Plan implemented by the Government of Armenia 0.90 0.92 Perception of enforcement mechanisms Have heard of someone paying bribes to obtain a public service in the last 12 months 1.76* 1.51† Thinks the Government’s fight against corruption in Armenia is effective 0.83 0.82 Agrees that the Government of Armenia has a sincere desire and will to combat corruption 1.61* 1.51* Perception of informal rules Would not take a bribe if was offered 1.18 1.06 Would not give a bribe if was asked 0.45** 0.44** Will personally undertake actions to reduce corruption in Armenia 0.86 0.83 Socio-demographic characteristics Age of the respondent 0.99 Sex of the respondent Female (Ref.) 1.00 Male 0.83 Education Less than secondary (Ref.) 1.00 Secondary 3.24** Technical and incomplete higher 2.56** Higher and postgraduate 4.70** Household’s monthly income (in drams) Less than 30 000 (Ref.) 1.00 30 001 to 75 000 0.96 75 001 to 120 000 0.86 120 001 and up 0.59† N of cases 1241 1176 *-2LL 895.0** 814.8**