Bribes in a Supply Line
The paper models the practice of charging bribes for faster delivery of essential services. It then examines the possibility of curbing corruption by supervision and by introducing competition among delivery agents. It is argued that a supervisory solution eludes the problem because no hard evidence of the reduction of corruption can be established for this type of offence. It is then shown that using more than one supplier reduces the bribe rate and the waiting period for both bribe-payers and others; and the aggregate gain of consumers exceeds the cost of hiring additional suppliers. Copyright (c) The London School of Economics and Political Science 2004.
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Volume (Year): 71 (2004)
Issue (Month): (02)
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References listed on IDEAS
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- Gabszewicz, Jean Jaskold & Thisse, Jacques-Francois, 1986. "On the Nature of Competition with Differentiated Products," Economic Journal, Royal Economic Society, vol. 96(381), pages 160-72, March.
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- Saha, Bibhas, 2001. "Red tape, incentive bribe and the provision of subsidy," Journal of Development Economics, Elsevier, vol. 65(1), pages 113-133, June.
- Marjit, Sugata & Mukherjee, Vivekananda & Mukherjee, Arijit, 2000. "Harassment, corruption and tax policy," European Journal of Political Economy, Elsevier, vol. 16(1), pages 75-94, March.
- Sah, Raaj Kumar, 1987. "Queues, Rations, and Market: Comparisons of Outcomes for the Poor and the Rich," American Economic Review, American Economic Association, vol. 77(1), pages 69-77, March.
- Polterovich, Victor, 1993. "Rationing, Queues, and Black Markets," Econometrica, Econometric Society, vol. 61(1), pages 1-28, January.
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