Darke Side of Social Capital Social Preferences and Corruption
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
|Date of creation:||08 Sep 2009|
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- Kofman, Fred & Lawarree, Jacques, 1993.
"Collusion in Hierarchical Agency,"
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"Collusion and Renegotiation in a Principal-Supervisor-Agent Relationship,"
1995-48, Tilburg University, Center for Economic Research.
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- 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 301-24, Fall.
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