The paper presents a theoretical model with bureaucratic corruption where bribe income can leak out of an economy. In … for entrepreneurship by maximizing the welfare of the economy. We show that the corruption persists at the equilibrium … in low prosperity economies the control of leakage may induce higher level of corruption, while the opposite is true in …

corruption. Overall, intermediation in corruption acts as an income redistribution mechanism that transfers value from … reluctant to obtain licenses through legal means. As a result corruption becomes endemic, particularly under regimes where … business costs are high, and measures to combat corruption are ineffective as they merely transfer value to intermediaries. A …

An economy is considered where a possibility to seek rents (a particular case of this activity is corruption) exists … low corruption the direct law enforcement is beneficial for growth, and reduces the shadow sector. However, in the highly … corrupt economy, combating the shadow economy reduces output and increases corruption, while combating corruption reduces the …

conclude discussing the implications for the fight of more harmful forms of corruption …

presence of corruption in the distribution of formal credit. The existing moneylender, the bank official and the new …

In transition and developing countries, we observe rather high levels of corruption even if they have democratic … high corruption levels. Our model is based on the fact that corrupt offcials have to pay an entry fee to get lucrative … positions. In a probabilistic voting model, we show that a lack of financial institutions can lead to more corruption as more …

community and formal enforcement, while corruption undermines it. We discuss how community can play an important role in a …

In many developing and transition countries, we observe rather high levels of corruption. This is surprising from a … political economy perspective, as the majority of people in a corrupt country suffer from high corruption levels. Our model is …, we show that a lack of financial institutions can lead to more corruption as more voters are part of the corrupt system …