Seminar Papers, Institute for International Economic Studies, Stockholm University
Who Must Pay Bribes and How Much? Evidence from a cross-section of firms
Abstract: This paper uses an unique data set on corruption
containing quantitative information on estimated bribe payments of Ugandan
firms. The data has two striking features; not all firms report they need
to pay bribes; and, there is a considerable variation in reported graft
across firms facing similar institutions/policies. To explain these
patterns we construct a simple bargaining model. The model yields
predictions on both the incidence and the level of graft. Consistent with
the model we find that variation in policies/regulations (across
industries) explain the incidence of corruption, while variation in
profitability and technology choice explain the variation in bribes for the
group of bribe paying firms. These findings suggest that public officials
act as price (bribe) discriminators, and that prices of public services are
endogenously determined in order to extract bribes.
Keywords: TBA; (follow links to similar papers)
JEL-Codes: C70; D00; (follow links to similar papers)
35 pages, May 24, 2002
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- This paper is forthcoming as:
Svensson, Jakob, 'Who Must Pay Bribes and How Much? Evidence from a cross-section of firms', Quarterly Journal of Economics.
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