IDEAS home Printed from https://ideas.repec.org/p/bcu/greewp/greenwp16.html
   My bibliography  Save this paper

Cartels and Bribes

Author

Listed:
  • Roberto Burguet
  • Elisabetta Iossa
  • Giancarlo Spagnolo

Abstract

We study the relationship between collusion and corruption in a stylized model of repeated procurement where the cost of reporting corrupt bureaucrats gives rise to a free riding problem. As in Dixit (2015, 2016), cooperation among honest suppliers alleviates free-riding in reporting. However, it also facilitates collusion in bidding by increasing the value of the collusive rent. In turn, bidding collusion facilitates cooperation in reporting by increasing the value of having honest bureaucrats, generating a trade-off. When the likelihood of corruption is high and competition is weak, collusion may be a price worth paying to curb corruption.

Suggested Citation

  • Roberto Burguet & Elisabetta Iossa & Giancarlo Spagnolo, 2021. "Cartels and Bribes," GREEN Working Papers 16, GREEN, Centre for Research on Geography, Resources, Environment, Energy & Networks, Universita' Bocconi, Milano, Italy.
  • Handle: RePEc:bcu:greewp:greenwp16
    as

    Download full text from publisher

    File URL: https://repec.unibocconi.it/iefe/bcu/papers/GREEN_wp16.pdf
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcu:greewp:greenwp16. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Carlotta Milani (email available below). General contact details of provider: https://edirc.repec.org/data/eabocit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.