International Economic Review Vol. 56, No. 3, August 2015
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Identifier
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DOI: 10.1111/iere.12129
Identifier
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https://repositorio.uchile.cl/handle/2250/134708
General note
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Artículo de publicación ISI
en_US
Abstract
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I model the role of intermediaries in corruption and examine the effects of policy on the level of intermediated corruption, price of permits, and welfare. Intermediaries with a history of being honest earn higher premiums. The frequency of corrupt transactions is inversely related to income levels. When the government increases the fraction of profits that it extracts from entrepreneurs, intermediation intensifies, as entrepreneurs are reluctant to obtain licenses through legal means. Therefore, when business costs are high, measures to combat corruption transfer value to intermediaries. Increasing the frequency of governments audits can increase the equilibrium price of permits.
en_US
Patrocinador
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Shouyong Shi's Bank of Canada Fellowship
Canada Research Chair
Institute for Research in Market Imperfections and Public Policy
ICM IS130002
Ministerio de Economia, Fomento y Turismo
Anillo in Social Sciences and Humanities
SOC 1402
Fondecyt
11140152