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Bureaucratic complexity and impacts of corruption in utilities

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  • Seim, Line Tndel
  • Sreide, Tina

Abstract

This paper explores how the relationship between bureaucratic complexity and corruption affects the performance in utilities. We observe considerable variation in the performance of the utilities across countries, even across countries which appear to be relatively similar. Our hypothesis is that corruption plays an important role in explaining this observed difference in performance. In particular, corruption coupled with a complex regulatory structure can have negative effects on performance. The analysis points at the importance of considering the institutional framework and institutional quality when introducing new bureaucratic procedures, as the same set of policy advice will work differently in different countries. We measure bureaucratic complexity by the number of procedures needed for starting a business from the Doing Business Database provided by the World Bank.

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File URL: http://www.sciencedirect.com/science/article/B6VFT-4V11J96-1/2/a9ee10697e2daea907f3c4de7a2c9fbc
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Bibliographic Info

Article provided by Elsevier in its journal Utilities Policy.

Volume (Year): 17 (2009)
Issue (Month): 2 (June)
Pages: 176-184

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Handle: RePEc:eee:juipol:v:17:y:2009:i:2:p:176-184

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Web page: http://www.elsevier.com/locate/inca/30478

Related research

Keywords: Corruption Bureaucracy Procedures Utilities Performance Institutional reform Developing countries;

References

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  1. World Bank & International Finance Corporation, 2006. "Doing Business in 2006 : Creating Jobs," World Bank Publications, The World Bank, number 7421, October.
  2. Antonio Estache & A. Goicoechea & Lourdes Trujillo, 2008. "Utilities reforms and corruption in developing countries," ULB Institutional Repository 2013/43908, ULB -- Universite Libre de Bruxelles.
  3. Svensson, Jakob, 2002. "Who Must Pay Bribes and How Much? Evidence from a cross-section of firms," Seminar Papers 713, Stockholm University, Institute for International Economic Studies.
  4. Laffont,Jean-Jacques, 2005. "Regulation and Development," Cambridge Books, Cambridge University Press, number 9780521840187, October.
  5. Acemoglu, D. & Verdier, T., 1997. "The Choice between Market Failures and Corruption," DELTA Working Papers 97-06, DELTA (Ecole normale supérieure).
  6. Toke S. Aidt, 2003. "Economic analysis of corruption: a survey," Economic Journal, Royal Economic Society, vol. 113(491), pages F632-F652, November.
  7. Clarke, George R. G. & Xu, Lixin Colin, 2004. "Privatization, competition, and corruption: how characteristics of bribe takers and payers affect bribes to utilities," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 2067-2097, August.
  8. Knack, Stephen, 2006. "Measuring corruption in Eastern Europe and Central Asia : a critique of the cross-country indicators," Policy Research Working Paper Series 3968, The World Bank.
  9. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
  10. Farid Gasmi & Paul Noumba Um & Laura Recuero Virto, 2009. "Political Accountability and Regulatory Performance in Infrastructure Industries: An Empirical Analysis," World Bank Economic Review, World Bank Group, vol. 23(3), pages 509-531, October.
  11. Odd-Helge Fjeldstad, 2005. "Corruption in Tax Administration: Lessons from Institutional Reforms in Uganda," CMI Working Papers WP 2005: 10, CMI (Chr. Michelsen Institute), Bergen, Norway.
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Cited by:
  1. Antonio Estache & Liam Wren-Lewis, 2010. "What Anti-Corruption Policy Can Learn from Theories of Sector Regulation," Working Papers ECARES ECARES 2010-033, ULB -- Universite Libre de Bruxelles.
  2. Berg, Sanford V. & Jiang, Liangliang & Lin, Chen, 2012. "Regulation and corporate corruption: New evidence from the telecom sector," Journal of Comparative Economics, Elsevier, vol. 40(1), pages 22-43.

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