Informality and Ukrainian higher educational institutions: Happy together?

Abstract

In post-socialist space, informal payments in educational institutions have often been at the centre of anti-corruption campaigns. A direct consequence, so far, has been that reforms in the public sector have largely been based on attempts to eradicate, or at least minimize, the phenomenon of informal payments. Ukraine is no exception. According to several independent surveys, educational institutions are second only to health care providers for the number of informal transactions recorded. While more than two in three of Ukrainians claim to have engaged with informal exchanges in the past 12 months, almost half of them has made an informal payment in an educational institution, be this a university or a school. The goal of this paper is two-fold. First, we explore the nature and relevance of the phenomenon of informal payments in the educational sector. We rely for this on quantitative studies showing how widespread informal payments are. Second, we provide an alternative explanation on informal payments by suggesting that they have an ambiguous function: while often regarded as a legacy of the socialist period, they can also be seen as a way to cope with an ineffective system that is mostly based on informal rules. By doing this we will provide some recommendations on how anti-corruption policies, and in general reforms aimed at decreasing the amount of informal payments in the country, could be improved.