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Contests, Common Agency, and Corruption: Why the Green Candidate Seldom Wins

Author

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  • Oliver, Matthew E.
  • Shogren, Jason F.

Abstract

Public sector corruption has been linked to resource dependency and environmental degradation in the developing world. Herein, we examine the persistence of public sector corruption by modeling an elected public official with the power to set agricultural/resource input-subsidization policy in a developing economy. Through common agency, firms offer bribes to influence policy. A more corrupt official extracts a greater bribe. This implies in a political contest between two candidates with different propensities for corruption, the corrupt incumbent, having the greater prize at stake, always expends greater effort and is the contest favorite. The less corrupt 'green' challenger is always the contest underdog. Our results suggest that i) corruption is politically advantageous; and ii) corruption and political instability are mutually reinforcing, leading to over-harvesting and too much pollution.

Suggested Citation

  • Oliver, Matthew E. & Shogren, Jason F., 2015. "Contests, Common Agency, and Corruption: Why the Green Candidate Seldom Wins," Strategic Behavior and the Environment, now publishers, vol. 5(2), pages 87-109, October.
    • Handle: RePEc:now:jnlsbe:102.00000057
    DOI: 10.1561/102.00000057
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    More about this item

    Keywords

    Public sector corruption; Common agency; Contest theory; Resource conversion;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

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