Decentralized Bribery and Market Participation

Popov, Sergey V.

doi:10.1111/sjoe.12081

Cited by 9 publications

(6 citation statements)

References 29 publications

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“…petitiveness of the market (say, by enabling privileged insiders to induce officials to maintain market barriers, or simply by raising the costs of market entry), and less competitive markets may be more prone to corruption(Cabelkova 2001; Emerson 2006;Popov 2015). Corruption may exacerbate economic inequality, and economic inequality may foster an environment in which corruption is more feasible and attractive(Uslaner 2008; Alesina & Angeletos 2005; Chong & Gradstein 2007; You & Khagram 2005).…”

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confidence: 99%

Corruption as a Self-Reinforcing Trap: Implications for Reform Strategy

Stephenson¹

2020

The World Bank Research Observer

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Corruption is widely believed to be a self-reinforcing phenomenon, in the sense that the incentive to engage in corrupt acts increases as corruption becomes more widespread. Some argue that corruption's self-reinforcing property necessarily implies that incremental anticorruption reforms cannot be effective, and that the only way to escape a high-corruption equilibrium “trap” is through a so-called “big bang” or “big push.” However, corruption's self-reinforcing property does not logically entail the necessity of a big bang approach to reform. Indeed, corruption's self-reinforcing property may strengthen the case for pursuing sustained, cumulative incremental reforms. While there may be other reasons to prefer a big bang approach to an incremental approach, this conclusion cannot be grounded solely or primarily on corruption's self-reinforcing character.

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confidence: 99%

Corruption as a Self-Reinforcing Trap: Implications for Reform Strategy

Stephenson¹

2020

The World Bank Research Observer

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“…Data on 80 electricity distribution firms, from 13 Latin American countries for the years 1994-2001, indicate that more corruption in the country is strongly associated with inefficient production (Dal Bo & Rossi, 2007). Theoretical work also examines corruption and efficiency: in Popov (2015) bribery of bureaucrats suppresses market participation and so reduces an economy's productivity.…”

Section: Literaturementioning

confidence: 99%

Why principals tolerate biases of inaccurate agents

Terai

Glazer

2018

Economics & Politics

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Some agents are more accurate than others in estimating the best policy. The more accurately an agent estimates a policy's effects, the more he will resist biases, such as bribes from a special interest. Thus, a special interest needs to pay a larger bribe to an accurate agent than to an inaccurate agent. The accurate agent who is biased will then more likely cause harm than does an inaccurate agent who favors the special interest. Therefore, the principal may gain more from controlling biases of an accurate agent than of an inaccurate one. Thus, high ability of public officials may be associated with little corruption.

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“…The question about the economic effects of corruption has been widely discussed in the economic literature (for recent summaries, see Ugur, 2014;and Popov, 2015). The mainstream view is that the microeconomic distortions caused by corruption turn to detrimental macroeconomic effects, say, on economic growth, capital accumulation, and employment.…”

Section: Corruption and Economic Performancementioning

confidence: 99%

Economic Integration and Corruption - EU Enlargement in Western Balkans

Laurila

2018

EurInsStud

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The paper examines possible EU enlargement in Western Balkans from the point of view corruption. Transparency International warns from the risks of acceleration and spreading of corruption in economic integration between states with different levels of integrity, and draws ambitious guidelines for optimal anticorruption policy. The paper aims for policy advices concerning proper anticorruption policy. The method is, first, to compare the candidate states to the current 28 EU states in terms of corruption and the quality of governance. Second, the paper surveys relevant economic literature on the macroeconomic effects of corruption, which shows that in countries, that are imprinted by both corruption and bad governance, particularly in terms of rule of law and government effectiveness, a straightforward attack on corruption is hopeless, and it may even be economically detrimental. The conclusion is that following the guidelines given by Transparency International is a too winding path to take, and it is almost impossible to set integrity as a precondition for entry. Optimal policy to avoid the contagion of corruption is to focus not on the candidates, but on the existing EU28, and particularly on close neighbors of the candidates. This can be done best by concentrating on international business transactions, namely by strict enforcement of the OECD anticorruption convention. The EU should pressure all member countries to uniform commitment to that project. After the entrance, the rooting out of corruption and the enhancement of formal governance in the new member states can then be carried out in due course.

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Decentralized Bribery and Market Participation

Cited by 9 publications

References 29 publications

Corruption as a Self-Reinforcing Trap: Implications for Reform Strategy

Corruption as a Self-Reinforcing Trap: Implications for Reform Strategy

Why principals tolerate biases of inaccurate agents

Economic Integration and Corruption - EU Enlargement in Western Balkans

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