Corruption and competition among bureaucrats: An experimental study

Dmitry Ryvkin and Danila Serra

Journal of Economic Behavior & Organization, 2020, vol. 175, issue C, 439-451

Abstract: We use a laboratory experiment to investigate how the introduction of competition between public officials for the provision of a government service affects extortionary corruption, i.e., the demands of harassment bribes. We examine transactions that are likely to be one-shot, such as the delivery of a driver's license, and transactions that require frequent interactions between the parties and therefore allow for reputation building, such as yearly renewals of building permits. Finally, we examine officials’ ability to collude by communicating before setting their bribe demands. We find that introducing competition significantly reduces corruption both in settings characterized by one-shot and by repeated interactions between citizens and officials. While the possibility of collusion lowers the effectiveness of competition, officials are unable to sustain collusion in the long run.

Keywords: Extortionary corruption; Monopoly; Competition; Collusion (search for similar items in EconPapers)
JEL-codes: C92 D49 D73 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:175:y:2020:i:c:p:439-451

DOI: 10.1016/j.jebo.2017.12.026

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