Does corruption have lower social cost when it is simply a cash bribe?

Translate Practice Questions

Contributed Content (0) and Suggested Materials (2)

Ask a Question

user's picture

I agree, that last part was a pretty poor argument. It assumed on the one hand that you are reducing competition by locking up Corrupt officials but then also assumes there is no competitive pressure from non-corrupt officials working in the same market of issuing licenses. - You could just as easily argue that nigher penalization would increase the numbers of non-corrupt license issuers and hence by market mechanisms reduce bribe costs. As licensees would just go see a non-corrupt licenser.

user's picture

In that case, it may be that the "honest" officials take it very easy when granting a license. So maybe it takes them 4 months to produce all the paperwork, whereas going to the more "corrupt" official might speed up the process by costing more in terms of cash.

Please register or login to answer a question
Please register or login to ask a question