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A Theory of Misgovernance

  • Banerjee, Abhijit V
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    This paper tries to explain why government bureaucracies are often associated with red tape, corruption, and lack of incentives. The paper identifies two specific ingredients that together can provide an explanation: the fact that governments often act precisely in situations where markets fail and the presence of agency problems within the government. The author shows that these problems are exacerbated at low levels of development and in bureaucracies dealing with poor people. The author also argues that he needs to posit the existence of a welfare-oriented constituency within the government in order to explain red tape and corruption. Copyright 1997, the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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    Article provided by MIT Press in its journal Quarterly Journal of Economics.

    Volume (Year): 112 (1997)
    Issue (Month): 4 (November)
    Pages: 1289-1332

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    Handle: RePEc:tpr:qjecon:v:112:y:1997:i:4:p:1289-1332
    Contact details of provider: Web page: http://mitpress.mit.edu/journals/

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