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dc.contributor.author Celentani, Marco
dc.contributor.author Ganuza, Juan José
dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
dc.date.accessioned 2017-07-26T12:07:50Z
dc.date.available 2017-07-26T12:07:50Z
dc.date.issued 1999-04-01
dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=382
dc.identifier.uri http://hdl.handle.net/10230/641
dc.description.abstract We study the dynamics of corruption relying on two fundamental observations: (a) Given agents detected as corrupt are typically fired and replaced, the historical levels of corruption have an impact on current corruption through the distribution of corruption costs of old agents; (b) Institutions negatively affected by their agents' corrupt activities are likely to respond optimally to it thereby decreasing the payoff from being corrupt. We model this situation by considering an agent who is supposed to monitor a contractor's delivery of a product or service and can manipulate his reports thus allowing the contractor to deliver lower quality in exchange for a bribe. Given the two generations of agents overlapping at any particular date, the administration sets an optimal level of quality in each period. We find that (i) A unique steady state level of corruption exists; (ii) Regardless of the initial distribution, apart from an initial period, equilibrium sequences are decreasing and converge to the steady state, a result we term the "Hadleyburg effect". We use these findings to study the dynamic response of corruption to both temporary and permanent shocks to the profitability of corruption and we find that the "Hadleyburg effect" has important positive and normative implications.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.relation.ispartofseries Economics and Business Working Papers Series; 382
dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Corruption and the Hadleyburg effect
dc.type info:eu-repo/semantics/workingPaper
dc.date.modified 2017-07-23T02:04:30Z
dc.subject.keyword corruption dynamics
dc.subject.keyword Microeconomics
dc.rights.accessRights info:eu-repo/semantics/openAccess


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