Regulation is widely considered as the key issue in reforms of public service sectors. But it has been pointed early to the problem that regulatory capture could undermine the stated aims of the reforms. This paper reviews the concept and the literature of regulatory capture under the special focus of public service sectors. Although mentioning corruption as an important mean way of capture, th...

The internet contains billions of documents. We study if there is useful information in the frequency with which different topics are written about. Based on the premise that the occurrence of an event increases its textual frequency, we assess whether internet document-frequency can capture cross-sectional variation in the occurrence-frequency of social phenomena. We characterize the condition...

This paper shows that a policy that uniformly increases contestants’ e¤ort costs can lead to an increase in total e¤ort. In asymmetric settings, this “levels the playing …eld”and therefore encourages weaker players (who otherwise would have stayed out) to enter. Paradoxically, a contest designer whose only objective is to maximize total e¤ort may thus wish to make rent-seeking “more di¢ cult.” ...

Using different combinations of culture, development and openness to international trade, we test the variability in the incidences of corruption at different stages of development or in other words the non-linearities in the relationship between corruption and development. We employ formal threshold model developed by Hansen (2000), and unlike the existing literature, we find that: (1) non-lin...

This paper deals with a Niskanen type of public-procurement agency. It is shown that the procurement game should be separated into an investment game and a project game, the first game to be played before nature determines the actual realizations of benefit and costs of the project, the second game to be played afterward. In the first game the relationship-specific investments of agency and sel...

This paper studies how income tax rates are determined and how they are related to government corruption in the form of fund capture. A model is presented where rich voters can block redistribution by buying the votes of some poor voters. In equilibrium there is only limited redistribution and income tax rates are a negative function of government corruption. When rich voters can bribe the gove...

Modern societies rely on both formal and social mechanisms to enforce social norms of behavior. Formal enforcement mechanisms rely on monetary or other tangible incentives while social enforcement mechanisms rely on some form of social judgment involving informal sanctions. We experimentally investigate the extent to which social observability and the possibility of social judgment affect indiv...

Corruption is usually depicted in one of two ways: as stemming from a lack of government accountability, or from a lack of capacity. Neither depiction predicts that the structure of institutions meant to control corruption should vary across autocratic regimes. If corruption results from moral hazard between politicians and citizens, then all unaccountable governments should eschew anticorrupti...