How business community institutions can help fight corruption

Document Type

Journal article

Source Publication

World Bank Economic Review

Publication Date

1-1-2015

Volume

29

Issue

Supp.

First Page

S25

Last Page

S47

Publisher

Oxford University Press

Abstract

Collective action by the business community to counter corruption in the award of government licenses and contracts is analyzed, by analogy with contract enforcement institutions studied by economic historians and contract law scholars. The suggested anti-corruption institution comprises a no-bribery norm, a system to detect violations, and a multilateral ostracism penalty upon conviction in a tribunal. In combination with formal state law, a business institution of sufficient quality-probability of detection and severity of punishment-can eliminate corruption; a less good institution helps reduce it. The legal and communal institutions together achieve substantially better outcomes than either by itself.

DOI

10.1093/wber/lhv016

Print ISSN

02586770

E-ISSN

1564698X

Publisher Statement

Copyright © The Author 2015. Access to external full text or publisher's version may require subscription.

Additional Information

Paper presented at the 25th Annual Bank Conference on Development Economics (ABCDE), Jun 02-03, 2014, World Bank Headquarters, Washington, DC.

Full-text Version

Publisher’s Version

Language

English

Recommended Citation

Dixit, A. K. (2015). How business community institutions can help fight corruption. World Bank Economic Review, 29(Supp.), S25-S47. doi: 10.1093/wber/lhv016

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