DP14992 How Does Kompromat Affect Politics? A Model of Transparency Regimes

Author(s): Monika Nalepa, Konstantin Sonin
Publication Date: July 2020
Date Revised: October 2020
Keyword(s): blackmail, signaling, transitional justice, transparency regime
JEL(s): D82, P26
Programme Areas: Public Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=14992

Why are transparency regimes so rare? When some politicians have something to conceal, why would their opponents not press for transparency? To analyze transitional justice, we build a model that explains why uncompromised politicians might avoid a transparency regime, which could signal to the voters that they are clean. We model the interaction between an incumbent, an opposition leader, a strategic blackmailer, and voters who know that the opposition politician may be compromised. The incumbent can implement a transparency regime, which would force out a compromised opponent and thus make blackmail impossible. We show that, instead, she might strategically opt for no transparency that keeps all skeletons of the ancient regime in the closet, as it is easier to defeat a potentially compromised opponent. We corroborate our results using original data from the Global Transitional Justice Dataset combined with data on elections, incumbency, and successor autocrat status in post-communist Europe.