A Duopoly Model of Political Agency with Applications to Anti-Corruption Reform

Haldun Evrenk ()

The B.E. Journal of Theoretical Economics, 2009, vol. 9, issue 1, 38

Abstract: Using a theoretical model of political competition between two candidates who could differ in their (unverifiable) ability to produce public good, popularity, and ethics, I study the effectiveness of three commonly discussed anti-corruption reforms (higher salaries, higher penalties, and constitutional constraints on fiscal policy). In the model, each candidate proposes an income tax rate and a public good level. The difference between the collected taxes and the cost of public good is stolen by the elected politician. The voting decision is probabilistic. I show that under certain conditions each reform could increase the level of corruption or reduce the voter's welfare through other channels.

Keywords: political agency; political competition; political corruption; anti-corruption reform (search for similar items in EconPapers)
Date: 2009
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DOI: 10.2202/1935-1704.1475

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