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Decentralized bribery and market participation

Popov, Sergey V. 2015. Decentralized bribery and market participation. Scandinavian Journal of Economics 117 (1) , pp. 108-125. 10.1111/sjoe.12081

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Abstract

I propose a bribery model that examines decentralized bureaucratic decision-making. There are multiple stable equilibria. High levels of bribery reduce an economy's productivity because corruption suppresses small business, and reduces the total graft, even though the size of an individual bribe might increase. Decentralization prevents movement towards a Pareto-dominant equilibrium. Anticorruption efforts, even temporary ones, might be useful to improve participation, if they lower the bribe levels demanded and thus encourage small businesses to participate.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HJ Public Finance
Publisher: Wiley
ISSN: 0347-0520
Funders: Basic Research Program of the National Research University Higher School of Economics
Date of First Compliant Deposit: 2 August 2017
Date of Acceptance: 31 July 2013
Last Modified: 07 Oct 2021 07:00
URI: http://orca.cardiff.ac.uk/id/eprint/103237

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