A computational exercise on the bureaucratic corruption within the principal-agent approach with lotteries
This paper models a corruption problem through the principal-agent framework with lotteries where the bureaucrat is regarded as the agent and the society, as the principal. The model contemplates three variables: bureaucratic efficiency, compensation and level of honesty. Solutions for the model wer...
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| Tipo de recurso: | artículo |
| Estado: | Versión publicada |
| Fecha de publicación: | 2022 |
| País: | Brasil |
| Institución: | Universidade Católica de Brasília (UCB) |
| Repositorio: | Economic Analysis of law Review |
| Idioma: | inglés |
| OAI Identifier: | oai:ojs.portalrevistas.ucb.br:article/12733 |
| Acceso en línea: | https://portalrevistas.ucb.br/index.php/EALR/article/view/12733 |
| Access Level: | acceso abierto |
| Palabra clave: | Corruption Principal-Agent Moral Hazard Lotteries |
| Sumario: | This paper models a corruption problem through the principal-agent framework with lotteries where the bureaucrat is regarded as the agent and the society, as the principal. The model contemplates three variables: bureaucratic efficiency, compensation and level of honesty. Solutions for the model were given using linear program algorithms. The optimal contracts indicate that: (1) under an unmonitored scenario, it is possible that the society be better off in the presence of extreme corruption; (2) risk-loving bureaucrats can provide more righteous conducts and increase the society’s expected utility; (3) altruist bureaucrats makes the society better off while spiteful bureaucrats makes the society worse off; and (4) higher reservation utility tends to increase the probability of the bureaucrats receive a high compensation. |
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