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Uncoordinated Corruption as an Equilibrium Phenomenon

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  • Hans Zenger

Abstract

Independent rent extraction by competing public officials produces a level of bribery that is too high both from the viewpoint of corrupt administrations and from the viewpoint of social welfare. Nevertheless, governments in many developing countries do not curb the harmful lack of coordination between complementary agencies. This paper explains this phenomenon by arguing that competition from organized crime and limited control of the bureaucratic apparatus make it optimal for rapacious governments not to coordinate the bureaucracy.

Suggested Citation

  • Hans Zenger, 2011. "Uncoordinated Corruption as an Equilibrium Phenomenon," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 167(2), pages 343-351, June.
    • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(201106)167:2_343:ucaaep_2.0.tx_2-c
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    References listed on IDEAS

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    1. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
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    JEL classification:

    • H10 - Public Economics - - Structure and Scope of Government - - - General

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