Corruption and statemaking

By Thomas Giacoletto

In Bringing the State Back In, Charles Tilly explains how the need to wage war lead to the the creation of modern nation states in Europe. He explains that different states had to develop different bureaucracies (and therefore institutional frameworks) to be able to extract enough resources to have an effective army. More populated and richer states therefore had a larger pool of resources to extract from while other states had to create a “bulkier” bureaucracy and a “more extensive” fiscal apparatus (182).

Tilly does not only point at the amount of resources that are available for extraction, but also at how good states were at extracting. In order to grasp all the resources they could, states had to create an institutional framework that was bulky enough to tackle the issues of citizen’s unwillingness to pay and corruption (tax-collectors who would accept bribes for example). Indeed, states’ abilities to extract the resources they needed depended on their population’s willingness to pay. In order to ensure payment, they only had two options, namely: offering protection to their citizens, and setting up institutions that would disincentivise any refusal to contribute.

Tilly focuses on the former, however it is a strategy which is likely to allow free riding, and corruption. Indeed, people know that the state cannot afford not to provide protection to a part of the population because they did not pay their taxes (or because they bribed their local tax-collector as it would probably also be dangerous for the rest of the population which would then doubt their protection. The state therefore could not only rely on the protection it gives its population in order to extract the resources it needed. States were incentivised to create institutional frameworks that strengthened bureaucracy and prevented these type of practices had to be put in place to force the population to pay.

Maybe considering corruption as a gap in the institutional framework that has to be fixed would help countries strengthen their bureaucracies and improve their extraction possibilities.