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Darke Side of Social Capital Social Preferences and Corruption

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  • Jellal, Mohamed

Abstract

Using the principal-agent- supervisor paradigm, this paper examines the occurrence of collusion in a setting where the principal has no information about the supervisor and the agent does not necessarily know the supervisor’s preferences. We formally prove the occurrence of collusion is more likely when the agent has information about the supervisor. This result suggests that corruption, which is likely to emerge in long term reciprocal relationships between public officials and potential bribery, may be reduced by the means of staff rotation. Evidence from an experimental study supports this proposition

Suggested Citation

  • Jellal, Mohamed, 2009. "Darke Side of Social Capital Social Preferences and Corruption," MPRA Paper 17179, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:17179
    as

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    File URL: https://mpra.ub.uni-muenchen.de/17196/1/MPRA_paper_17196.pdf
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    References listed on IDEAS

    as
    1. Mookherjee, Dilip & Png, I P L, 1995. "Corruptible Law Enforcers: How Should They Be Compensated?," Economic Journal, Royal Economic Society, vol. 105(428), pages 145-159, January.
    2. Strausz, Roland, 1997. " Collusion and Renegotiation in a Principal-Supervisor-Agent Relationship," Scandinavian Journal of Economics, Wiley Blackwell, vol. 99(4), pages 497-518, December.
    3. Kofman, Fred & Lawarree, Jacques, 1993. "Collusion in Hierarchical Agency," Econometrica, Econometric Society, vol. 61(3), pages 629-656, May.
    4. Laffont, Jean-Jacques, 1990. "Analysis of Hidden Gaming in a Three-Level Hierarchy," Journal of Law, Economics, and Organization, Oxford University Press, vol. 6(2), pages 301-324, Fall.
    5. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
    6. Besley, Timothy & McLaren, John, 1993. "Taxes and Bribery: The Role of Wage Incentives," Economic Journal, Royal Economic Society, vol. 103(416), pages 119-141, January.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Principal Agent Supervisor paradigm; Social Capital ; Social Preferences; Bureaucracy; Corruption ; Staff Rotation;

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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