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Bureaucratic competition versus monopoly: measuring corruption and welfare

Author

Listed:
  • Panchali Banerjee

    (Jadavpur University)

  • Vivekananda Mukherjee

    (Jadavpur University)

Abstract

The paper constructs a framework where both welfare-impact and corruption-impact of the introduction of competition in a monopoly bureaucracy can be derived. Two different measures of corruption i.e. Incidence of Corruption and Corruption Rents have been applied to measure two different types of corruption: extortion and collusion. The paper shows that the conclusion we draw about corruption-impact and welfare-impact of the introduction of competition in a bureaucracy depends on the type of corruption we are looking at and the type of measure we are using. It also shows that with the introduction of competition in a monopoly bureaucracy the corruption measure and the welfare measure of an economy may move in opposite directions. The policy implications of the results are discussed.

Suggested Citation

  • Panchali Banerjee & Vivekananda Mukherjee, 2020. "Bureaucratic competition versus monopoly: measuring corruption and welfare," Indian Economic Review, Springer, vol. 55(1), pages 51-65, June.
    • Handle: RePEc:spr:inecre:v:55:y:2020:i:1:d:10.1007_s41775-020-00080-8
    DOI: 10.1007/s41775-020-00080-8
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    References listed on IDEAS

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    5. Drugov, Mikhail, 2010. "Competition in bureaucracy and corruption," Journal of Development Economics, Elsevier, vol. 92(2), pages 107-114, July.
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    7. Ahlin, Christian & Bose, Pinaki, 2007. "Bribery, inefficiency, and bureaucratic delay," Journal of Development Economics, Elsevier, vol. 84(1), pages 465-486, September.
    8. Jakob Svensson, 2005. "Eight Questions about Corruption," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 19-42, Summer.
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    Cited by:

    1. Vivekananda Mukherjee & Paramita Mukherjee & Saheli Bose, 2022. "Extortion, competition among states and private investment in a federation: evidence from Indian manufacturing sector," Economic Change and Restructuring, Springer, vol. 55(2), pages 973-1004, May.

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    More about this item

    Keywords

    Corruption; Competition; Bureaucracy; Measures of corruption; Extortion; Collusion;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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