Following monetary union with west Germany in June 1990 the median real monthly wage of prime age east German workers rose by 83% in six years. I use the German Socio-Economic Panel data to investigate the determinants of this wage growth and some of its implications. For the 1990-1991 period I...

We provide a theoretical framework for understanding when an official angles for a bribe, when a client pays, and the payoffs to the client’s decision. We test this frame work using a new data set on bribery of Peruvian public officials by households. The theory predicts that bribery is more...

Using cross–country and Peruvian data, I show that victims of misfortune, particularly crime victims, are much more likely than non–victims to bribe public officials. Misfortune increases victims’ demand for public services, raising bribery indirectly, and also increases victims’...

Using detailed Peruvian data measuring bribery, I assess which types of public official are most corrupt and why. I distinguish between the bribery rate and the size of bribes received, and seek to explain the variation in each across public institutions. The characteristics of officials’...

Following the unification of Germany in 1990, eastern wages and unemployment both rose rapidly. I demonstrate that rising wages reduced eastern emigration greatly, while rising unemployment had little effect. This reflects the behavior of the young, who are very sensitive to source region wages,...