Who gains from Non-Collusive Corruption?
Journal
Journal of Development Economics
ISSN
0304-3878
ISSN-Digital
1872-6089
Type
journal article
Date Issued
2007-01-01
Author(s)
Abstract (De)
Non-collusive corruption, i.e., corruption that imposes an additional burden on business activity, is particularly widespread in low-income countries. We build a macroeconomic model with credit market imperfections and heterogeneous agents to explore the roots and consequences of this type of corruption. We find that credit market imperfections, by generating rents for the incumbent entrepreneurs, create strong incentives for corrupt behavior by state officials. However, non-collusive corruption not only redistributes income from non-officials towards officials but also within the group of potential entrepreneurs. If borrowing is limited, bribes prevent poorer but talented individuals from starting a business. But this is likely to benefit those who may enter anyway; the cost of capital is lower and there is less competition on the goods markets.
Language
German
Keywords
Corruption
Income inequality
Credit market imperfections
Development
HSG Classification
contribution to scientific community
Refereed
No
Publisher
Elsevier
Publisher place
Amsterdam
Volume
82
Number
1
Start page
95
End page
119
Pages
25
Subject(s)
Eprints ID
184824