We use the HOSV model of trade to find out a link between corruption and the pattern of trade, not just its effect on … the volume of trade. We prove that greater corruption in labor-abundant countries will restrict the volume of world trade … transaction cost of corruption. Relatively corrupt economy will export capital-intensive goods. However, relatively capital …

Most theoretical studies of corruption develop micro models of individual acts while empirical papers study corruption … societal corruption level is derived from individual corruption levels optimally chosen by agents with varying risk aversion … and human capital. It, in turn, affects the risk-return profile of corruption for the individual agents. Simulating a …