Title

Kleptocracy and corruption

Document Type

Journal article

Source Publication

Journal of Comparative Economics

Publication Date

3-1-2006

Volume

34

Issue

1

First Page

57

Last Page

74

Keywords

Corruption, Corruption deterrence, Kleptocracy, Rent-seeking competition

Abstract

In this paper, we develop a model that analyzes the competition and strategic interactions between a kleptocratic ruler and his officials in rent seeking. The ruler implements anti-corruption measures, which include wage incentives and monitoring, to discourage his opportunistic officials from seeking bribes to obtain more rent for himself. We show that the ruler pays an efficiency wage to his officials to eliminate corruption if and only if monitoring is relatively effective. We also demonstrate that, in a proprietary state, the ruler always sets an inefficiently high tax rate in order to discourage the officials from demanding bribes.

DOI

10.1016/j.jce.2005.11.001

Print ISSN

01475967

E-ISSN

10957227

Publisher Statement

Copyright © 2005 Association for Comparative Economic Studies

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Full-text Version

Publisher’s Version

Recommended Citation

Fan, C. S. (2006). Kleptocracy and corruption. Journal of Comparative Economics, 34(1), 57-74. doi: 10.1016/j.jce.2005.11.001