arise when monitoring corruption is difficult relative to monitoring the provision of public services, and politically …-important groups of citizens do not bear the full cost of corruption. The existence of such systems can distort the effective incidence … of the tax burden, reduce the incentives of government to fight corruption, and legitimize bribe-taking …

We study the emergence and interaction of red tape and corruption in a principal-bureaucrat-agent hierarchy. The … bribes to conceal the information produced through red tape. Even though the former kind of corruption tends to reduce red …