A Note on Exogenous Changes in Incentives for and Deterrence of Corruption

Posted: 1 Jun 2011

See all articles by Giuseppe DiVita

Giuseppe DiVita

University of Catania - Department of Economics and Business

Date Written: May 30, 2011

Abstract

In this note we amend the model elaborated by Acemoglu and Verdier (2000), to examine how agents respond to an exogenous change in incentives. In particular, we apply the theoretical framework to the consequences on the corruption level in Italy of a famous sentence of the Italian Corte di Cassazione in plenary session: \ in this sentence, no. 500 of 1999, a revolutionary interpretation of the law has increased the area of civil liability for both the public administration and bureaucrats. This is one of the few cases in which the judge substantially legislates in a system of \QTR{it}{civil law}, and the modification in incentives towards or away from corruption comes from an authority that is not part of the game.

Keywords: bureaucrats, corruption, government failure, incentives, market failure, public goods

JEL Classification: M35, F45, J63

Suggested Citation

DiVita, Giuseppe, A Note on Exogenous Changes in Incentives for and Deterrence of Corruption (May 30, 2011). European Journal of Law and Economics, Vol. 24, No. 1, 2007, Available at SSRN: https://ssrn.com/abstract=1855531

Giuseppe DiVita (Contact Author)

University of Catania - Department of Economics and Business ( email )

Corso Italia no. 55
Catania 95129, Catania
Italy
+39 95 230335 (Phone)
+39 95 321654 (Fax)

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