The Pitfalls of a Partially Honest Bureaucracy: Bribery, Inefficiency, and Bureaucratic Delay
Bribery, it has been argued, allocates resources efficiently. We show that this conclusion need not hold in a dynamic extension of a simple static model in which it does. When permits are awarded over time and applicants can reapply, a partially honest bureaucracy results in inefficiency. This can take the form of both misallocation and bureaucratic delay, both of which are strategic maneuvers by dishonest bureaucrats to increase bribery income. Efficiency is a non-monotonic function of the fraction of bureaucrats that are honest. Consequently, small differences in monitoring costs may lead to very different optimal levels of corruption.
|Date of creation:||Dec 2002|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.vanderbilt.edu/econ/wparchive/index.html|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lui, Francis T, 1985. "An Equilibrium Queuing Model of Bribery," Journal of Political Economy, University of Chicago Press, vol. 93(4), pages 760-81, August.
When requesting a correction, please mention this item's handle: RePEc:van:wpaper:0224. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (John P. Conley)
If references are entirely missing, you can add them using this form.