Abstract
We examine the relationship between actual and perceived corruption, exploring how individuals' direct experiences of corruption align with their beliefs about group-level corrupt behavior. Using a repeated public good game with an option to bribe a computerized bureaucrat, we analyze how the availability of information on corrupt behavior affects both individual willingness to engage in corruption and group-wide perceptions of corruption. Our findings indicate that when information about corruption is not publicly shared, individuals are more likely to offer bribes, exacerbating a collective action problem where the public good is undermined by free-riding behavior. However, when information about corruption is transparently communicated, individuals are less inclined to act corruptly, reflecting the potential of transparency to solve collective action dilemmas by aligning personal actions with the collective interest. These results highlight the pivotal role of perceived group behavior in shaping individual decisions and suggest that policies fostering transparency and information-sharing can mitigate corruption by avoiding the deterioration of the social norm and the consequent collective loss.