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Mises, Hayek and Corruption

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  • Tomas Otahal

    () (Department of Economics, Faculty of Business and Economics, Mendel University in Brno)

Abstract

Using the arguments of Ludwig von Mises and Friedrich August von Hayek, I argue that private ownership solves the economic problem of corruption. Since private ownership discourages entrepreneurs from rent-seeking, and privately owned media provide objective and unbiased information to citizens, any legal reform establishing and enforcement of private ownership also solves the corruption problem.

Suggested Citation

  • Tomas Otahal, 2013. "Mises, Hayek and Corruption," MENDELU Working Papers in Business and Economics 2013-34, Mendel University in Brno, Faculty of Business and Economics.
  • Handle: RePEc:men:wpaper:34_2013
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    References listed on IDEAS

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    1. Brunetti, Aymo & Weder, Beatrice, 2003. "A free press is bad news for corruption," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1801-1824, August.
    2. Raymond Fisman & Edward Miguel, 2007. "Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets," Journal of Political Economy, University of Chicago Press, vol. 115(6), pages 1020-1048, December.
    3. Jay Pil Choi & Marcel Thum, 2004. "The Economics of Repeated Extortion," RAND Journal of Economics, The RAND Corporation, vol. 35(2), pages 203-223, Summer.
    4. Tomáš Otáhal, 2007. "Why Is Corruption a Problem of the State?," Prague Economic Papers, University of Economics, Prague, vol. 2007(2), pages 165-179.
    5. Djankov, Simeon & Glaeser, Edward & La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei, 2003. "The new comparative economics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 595-619, December.
    6. Jakob Svensson, 2005. "Eight Questions about Corruption," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 19-42, Summer.
    7. Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1991. "The Allocation of Talent: Implications for Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 503-530.
    8. Cuneyt Koyuncu & Harun Ozturkler & Rasim Yilmaz, 2010. "Privatization and corruption in transition economies: a panel study," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 13(3), pages 277-284.
    9. Gordon Tullock, 1996. "Corruption Theory And Practice," Contemporary Economic Policy, Western Economic Association International, vol. 14(3), pages 6-13, July.
    10. Harstad, Bård & Svensson, Jakob, 2011. "Bribes, Lobbying, and Development," American Political Science Review, Cambridge University Press, vol. 105(01), pages 46-63, February.
    11. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June.
    12. Bjorvatn, Kjetil & Soreide, Tina, 2005. "Corruption and privatization," European Journal of Political Economy, Elsevier, vol. 21(4), pages 903-914, December.
    13. Peter T. Leeson, 2008. "Media Freedom, Political Knowledge, and Participation," Journal of Economic Perspectives, American Economic Association, vol. 22(2), pages 155-169, Spring.
    14. Enrico Colombatto, 2003. "Why is Corruption Tolerated?," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 16(4), pages 363-379, December.
    15. Martimort, David & Straub, Stéphane, 2009. "Infrastructure privatization and changes in corruption patterns: The roots of public discontent," Journal of Development Economics, Elsevier, vol. 90(1), pages 69-84, September.
    16. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    17. Cuneyt Koyuncu & Harun Ozturkler & Rasim Yilmaz, 2010. "Privatization and corruption in transition economies: a panel study," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 13(3), pages 277-284.
    18. 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.
    19. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, Oxford University Press, vol. 98(3), pages 371-400.
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    Cited by:

    1. Warning, Susanne & Dürrenberger, Nicole, 2015. "Corruption and education: Does public financing of higher education matter?," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112836, Verein für Socialpolitik / German Economic Association.

    More about this item

    Keywords

    Austrian school; corruption; economic calculation; rent-seeking;

    JEL classification:

    • B25 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Historical; Institutional; Evolutionary; Austrian; Stockholm School
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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