A Game-Theoretic Explanation for the Persistence of Political Corruption
Using a theoretical model of two-candidate competition, I study the political support for a fully effective and costless reform targeting high level political corruption. I find that when the candidates have a high discount factor, and when the level of political corruption is not too low, both corrupt and honest candidates have incentives to oppose the reform. I also find that a fully informed and fully coordinated electorate can change a candidate's incentives by bundling the reform with high wages and by voting strategically.
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- James W. Friedman, 1971. "A Non-cooperative Equilibrium for Supergames," Review of Economic Studies, Oxford University Press, vol. 38(1), pages 1-12.
- Francesco Caselli & Massimo Morelli, 2001.
NBER Working Papers
8532, National Bureau of Economic Research, Inc.
- Francesco Caselli & Massimo Morelli, 2000. "Bad politicians," Discussion Paper / Institute for Empirical Macroeconomics 134, Federal Reserve Bank of Minneapolis.
- Caselli, Francesco & Morelli, Massimo, 2000. "Bad Politicians," CEPR Discussion Papers 2402, C.E.P.R. Discussion Papers.
- Evrenk, Haldun, 2008. "Mackerels in the Moonlight: A Duopoly Model of Political Agency," Working Papers 2008-4, Suffolk University, Department of Economics.
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