They came up with a great idea to measure illicit antiquities entering the United States. They capitalize on the odd way the trade works. An object may be illegally exported from a source nation, but be imported and sold in a perfectly legal manner in the United States. The historic justification for this is the idea that nations will not enforce the public laws of another nation. However this policy has disastrous consequences for the antiquities trade. By focusing on this paperwork gap, they can estimate the nations with the biggest loss of antiquities. The biggest reporting gaps are in Syria, Iran, Egypt, Greece, Vietnam and Russia. As one would expect Canada, New Zealand, Britain and Hong Kong have low reporting gaps. Both Canada and Britain of course have limited export restrictions.
Here's the abstract:
We empirically analyze the illicit trade in cultural property and antiques, taking advantage of different reporting incentives between source and destination countries. We thus generate a measure of illicit trafficking in these goods based on the difference between imports recorded in United States' customs data and the (purportedly identical) trade as recorded by customs authorities in exporting countries. We find that this reporting gap is highly correlated with the corruption level of the exporting country as measured by commonly used survey-based indicies, and that this correlation is stronger for artifact-rich countries. As a placebo test, we do not observe any such pattern for U.S. imports of toys from these same exporters. We report similar results for four other Western country markets. Our analysis provides a useful framework for studying trade in illicit goods. Further, our results provide empirical confirmation that survey-based corruption indicies are informative, as they are correlated with an objective measure of illicit activity.
(Hat tip: Jay Hancock)
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