Combating Corruption with Bargaining Disruption

Fabio Mendez ()

Journal of Institutional and Theoretical Economics (JITE), 2009, vol. 165, issue 3, 438-453

Abstract: This paper presents a theoretical model in which governments regulate economic activity and individuals bypass the regulations by paying bribes to the public officials who monitor their businesses; the amount of the bribe is the subject of bargaining. The paper then introduces a policy that disrupts the bribe-bargaining process by rewarding public officials beyond what they would expect to receive if they accepted a bribe. This policy is referred to as bargaining disruption. The results of the model suggest that such policies can effectively combat corruption.

JEL-codes: D73 K42 (search for similar items in EconPapers)
Date: 2009
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