Does Competition Kill Corruption?
Corrupt agents (officials or gangsters) exact money from firms. Corruption affects the number of firms in a free-entry equilibrium. The degree of deep competition in the economy increases with lower overhead costs relative to profits and with a tendency toward similar cost structures. Increases in c...
| Main Authors: | , |
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| Format: | Journal article |
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1997
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| _version_ | 1797092925444718592 |
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| author | Bliss, C Tella, R |
| author_facet | Bliss, C Tella, R |
| author_sort | Bliss, C |
| collection | OXFORD |
| description | Corrupt agents (officials or gangsters) exact money from firms. Corruption affects the number of firms in a free-entry equilibrium. The degree of deep competition in the economy increases with lower overhead costs relative to profits and with a tendency toward similar cost structures. Increases in competition may not lower corruption. The model explains why a rational corrupt agent may extinguish the source of his bribe income by causing a firm to exit. Assessing the welfare effect of corruption is complicated by the fact that exit caused by corruption does not necessarily reduce social welfare. |
| first_indexed | 2024-03-07T03:53:00Z |
| format | Journal article |
| id | oxford-uuid:c1eac395-9a6f-4cc8-a31a-8de01d9f12c7 |
| institution | University of Oxford |
| last_indexed | 2024-03-07T03:53:00Z |
| publishDate | 1997 |
| record_format | dspace |
| spelling | oxford-uuid:c1eac395-9a6f-4cc8-a31a-8de01d9f12c72022-03-27T06:05:05ZDoes Competition Kill Corruption?Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:c1eac395-9a6f-4cc8-a31a-8de01d9f12c7Department of Economics - ePrints1997Bliss, CTella, RCorrupt agents (officials or gangsters) exact money from firms. Corruption affects the number of firms in a free-entry equilibrium. The degree of deep competition in the economy increases with lower overhead costs relative to profits and with a tendency toward similar cost structures. Increases in competition may not lower corruption. The model explains why a rational corrupt agent may extinguish the source of his bribe income by causing a firm to exit. Assessing the welfare effect of corruption is complicated by the fact that exit caused by corruption does not necessarily reduce social welfare. |
| spellingShingle | Bliss, C Tella, R Does Competition Kill Corruption? |
| title | Does Competition Kill Corruption? |
| title_full | Does Competition Kill Corruption? |
| title_fullStr | Does Competition Kill Corruption? |
| title_full_unstemmed | Does Competition Kill Corruption? |
| title_short | Does Competition Kill Corruption? |
| title_sort | does competition kill corruption |
| work_keys_str_mv | AT blissc doescompetitionkillcorruption AT tellar doescompetitionkillcorruption |