Corruptible Law Enforcers: How Should They Be Compensated?
- 1 January 1995
- journal article
- research article
- Published by Oxford University Press (OUP) in The Economic Journal
- Vol. 105 (428) , 145-159
- https://doi.org/10.2307/2235324
Abstract
We study the optimal compensation policy for a corruptible inspector, charged with monitoring pollution from a factory. Our utilitarian approach focuses on the trade-off among corruption, pollution, and enforcement effort. Owing to the strategic interaction between factory and inspector, changes in compensation policy have surprising effects, e.g., raising the penalty for corruption may cause pollution to increase. We find that bribery is an inefficient way of encouraging the inspector to monitor; society should wipe out corruption.This publication has 4 references indexed in Scilit:
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- On the theory of tax reformJournal of Public Economics, 1976
- Welfare effects of tax and price changesJournal of Public Economics, 1975