On Basu's Proposal: Fines Affect Bribes

Sergey Popov

No 16-04, Economics Working Papers from Queen's Management School, Queen's University Belfast

Abstract: I provide a model that connects the bribe amount with the fines imposed on both bribe-taker and bribe-payer. I show that the proposal of Basu (2011) to not punish bribe-payers to induce whistleblowing does not have to help lower bribes. Higher fines on bribe-takers will make them ask for larger bribes, whereas lowering fines for bribe-paying on bribe-payers might increase their willingness to pay the bribe. An increase in transparency, if achieved, effectively increases both fines simultaneously.

Keywords: Corruption; Bribery; Decentralization; Fines (search for similar items in EconPapers)
JEL-codes: D73 (search for similar items in EconPapers)
Pages: 7 pages
Date: 2016-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: On Basu s Proposal: Fines Affect Bribes (2017)
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