Who Must Pay Bribes and How Much? Evidence from a Cross-Section of Firms
The author exploits a unique data set on corruption containing information about estimated bribe payments by Ugandan firms. To guide the empirical analysis, he develops a simple rent-extortion model, which yields predictions on both the incidence o...
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| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2000/11/729382/must-pay-bribes-much-evidence-cross-section-firms http://hdl.handle.net/10986/19749 |
| Summary: | The author exploits a unique data set on
corruption containing information about estimated bribe
payments by Ugandan firms. To guide the empirical analysis,
he develops a simple rent-extortion model, which yields
predictions on both the incidence of bribery, and the amount
paid. Both predictions are consistent with the data. Firms
typically have to pay bribes when dealing with public
officials whose actions directly affect the firms'
business operations. And the amount paid in bribes is not a
fixed sum for a set of public services, but depends on the
firm's ability to pay. Controlling for other potential
explanations of the relationship between "ability to
pay" and equilibrium graft, the author shows that the
more a firm can pay, the more it has to pay. |
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