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When competition corrupts : a theoretical analysis of market structure and the incidence of corruption (English)

The paper develops a simple model to demonstrate that, paradoxically, greater competition may exacerbate the problem of corruption. Market participants engaging in corrupt practices enjoy lower production costs -- maybe because they pay a bribe to avoid installing the environmental safeguards required by law -- such that honest players are driven out of the market when the market becomes sufficiently competitive. ... See More +

Policy Research Working Paper WPS6596 SEP 01, 2013

Basu, Kaushik; McGavock, Tamara; Zhang, Boyang Disclosed