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On corruption, bribes and the exchange of favors

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Listed author(s):
  • Rodrigues-Neto, José A.

Abstract

This paper investigates how the availability of alternative forms of bribe payments, on top of money, may facilitate corruption. There are two bribe payment technologies and a Corruptor and a Receiver must agree on the value and on the technology of the bribe. The paper infers which form of payment can be used by analyzing probabilities of punishment, bargaining powers of agents, and relative efficiency of the two different technologies. By assumption, monetary payments have distinct efficiency than do non-monetary favors. If the Receiver has a sufficiently high utility for payments using a particular technology, then only bribes paid via this technology are feasible. There is also a range of intermediate cases where monetary bribery is used if and only if the relative bargaining power of the Receiver is sufficiently large compared to that of the Corruptor.

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Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 38 (2014)
Issue (Month): C ()
Pages: 152-162

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Handle: RePEc:eee:ecmode:v:38:y:2014:i:c:p:152-162
DOI: 10.1016/j.econmod.2013.12.010
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/30411

Keywords: Bribe; Corruption; Favor; Money; Sex;

Find related papers by JEL classification:

  • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
  • K20 - Law and Economics - - Regulation and Business Law - - - General
  • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General

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