Partners in crime : collusive corruption and search
Data(s) |
01/01/2008
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Resumo |
This paper analyzes corruption as a collusive act which requires the participation of two willing partners. An agent intending to engage in a corrupt act must search for a like-minded partner. When many people in the economy are corrupt, such a search is more likely to be fruitful. Thus when an agent engages in a search, he raises the net benefit of searching for other similar agents in the economy, creating an externality. This introduces a non-convexity in the model, which consequently has multiple equilibria. The economy can be in stable equilibrium with a high or low level of corruption.<br /><br />Starting from the high-corruption equilibrium, a sufficient increase in vigilance triggers a negative cascade, leading the economy to a new equilibrium in which no agent finds it profitable to search for corrupt partners. The no-corruption equilibrium continues to be stable if vigilance is then relaxed. This suggests that the correct way to deal with corruption is to launch a ``big push'' with large amounts of resources. Once the level of corruption declines, these resources can be withdrawn.<br /> |
Identificador | |
Idioma(s) |
eng |
Publicador |
Berkeley Electronic |
Relação |
http://dro.deakin.edu.au/eserv/DU:30017931/nabine-partnersincrime-2008.pdf http://www.bepress.com/bejeap/vol8/iss1/ |
Direitos |
2008, Walter de Gruyter GmbH & Co. KG |
Tipo |
Journal Article |