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A Comment on "Corruption by Design."

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  • Yavas, Cemile

Abstract

In an article that appeared in the April 1996 issue of this journal, Melanie Manion analyzed corruption incidence in Chinese enterprise licensing using a multistage game. The model, she concludes, implies that bribery is quite robust and "to move away entirely from the corrupt equilibria... requires very substantial changes in institutional design." Manion models a multistage game with three stages, she solves for the equilibrium in a subgame consisting of the last two stages, but she neglects to check whether this subgame is played in the equilibrium. As a result her conclusion is incorrect. The purpose of this comment is to demonstrate the flaws in Manion's analysis. Copyright 1998 by Oxford University Press.

Suggested Citation

  • Yavas, Cemile, 1998. "A Comment on "Corruption by Design."," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 14(1), pages 174-179, April.
    • Handle: RePEc:oup:jleorg:v:14:y:1998:i:1:p:174-79
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