Corruption, property rights and the allocation of talent: a general equilibrium approach


Acemoglu, Daron and Verdier, Thierry (1998) Corruption, property rights and the allocation of talent: a general equilibrium approach The Economic Journal, 108, (450), pp. 1381-1403. (doi:10.1111/1468-0297.00347).

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Description/Abstract

We consider an economy where contracts are necessary to encourage investments. Contract enforcement requires that a fraction of the agents work in the public sector and do not accept bribes. We find that: (1) It may be optimal to allow some corruption and not enforce property rights fully. (2) Less developed economies may choose lower levels of property right enforcement and more corruption. (3) There may exist a 'free-lunch' such that over a certain range it is possible simultaneously to reduce corruption, increase investment, and achieve a better allocation of talent.

Item Type: Article
Digital Object Identifier (DOI): doi:10.1111/1468-0297.00347
ISSNs: 0013-0133 (print)
Subjects:
ePrint ID: 33459
Date :
Date Event
1998Published
Date Deposited: 22 Dec 2006
Last Modified: 16 Apr 2017 22:15
Further Information:Google Scholar
URI: http://eprints.soton.ac.uk/id/eprint/33459

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