Theoretical Considerations on Corruption and an Essay on International Trade

Theoretical Considerations on Corruption and an Essay on International Trade
Author: Luciana Echazu
Publisher:
Total Pages: 91
Release: 2007
Genre:
ISBN: 9780549019770

My dissertation consists of three essays in two different areas. My first essay explores corruption within the shadow economy in two ways. First I examine the role of incentives on corruption and on the size of the shadow economy. Second, I look into the industrial organization of corruption; specifically I investigate whether centralizing the bureaucratic system always leads to a decrease in corruption. Using a game theoretical model that portrays two sectors of the economy (formal and shadow economy), and opportunistic bureaucrats in both sectors, I show that increasing incentives to honesty among monitoring agents in the informal sector does not always lead to a decrease in the size of the shadow economy. Furthermore, I show whenever corruption is present in the informal sector total centralization of government agencies may increase, rather than decrease the overall level of corruption. In my second essay I present a theoretical model that explains the empirical findings of a negative relationship between female participation in the government and corruption. Specifically, I propose that although psychic costs for both male and female do not intrinsically differ from one another, the cut off values of these costs are different for each gender, arise endogenously, and are related to the proportion of female participation in government agencies. Hence, females behave more honestly than males do, not because they are naturally prone to it but because they cannot afford to be corrupt if they are minority. In that sense, the total density of corruption is non-monotonic in the proportion of female participation in government agencies. Finally, in my third essay, I test some further empirical implications of the Alchian-Allen Effect. In particular, I study the relation between the Alchian-Allen effect and product heterogeneity within industries; I show---both theoretically and empirically---that for those industries with higher product heterogeneity, the Alchian-Allen effect is stronger. I then test the relationship between the Alchian-Allen effect and demand for imports, and the number of varieties in a product mix. The tests show that higher Alchian-Allen effects make these two mentioned variables less sensitive to changes in freight.

Greed, Corruption, and the Modern State

Greed, Corruption, and the Modern State
Author: Susan Rose-Ackerman
Publisher: Edward Elgar Publishing
Total Pages: 383
Release: 2015-09-25
Genre: Law
ISBN: 1784714704

What makes the control of corruption so difficult and contested? Drawing on the insights of political science, economics and law, the expert contributors to this book offer diverse perspectives. One group of chapters explores the nature of corruption in democracies and autocracies, and “reforms” that are mere facades. Other contributions examine corruption in infrastructure, tax collection, cross-border trade, and military procurement. Case studies from various regions – such as China, Peru, South Africa and New York City – anchor the analysis with real-world situations. The book pays particular attention to corruption involving international business and the domestic regulation of foreign bribery.

Essays on Political Connections, Corruption and International Trade

Essays on Political Connections, Corruption and International Trade
Author: Oskar Nelvin
Publisher:
Total Pages: 137
Release: 2010
Genre: Free trade
ISBN:

The first chapter aims at assessing the importance of political connections for the profitability of privately owned firms. The value of connections is estimated using a unique quasi-natural experiment: The September 2006 Thai coup d'état. Connections are found to be potentially very valuable, accounting for as much as 20% of market capitalization for the best connected firms. Benefits from connections include lower taxation and better access to debt financing. Firms operating in domestically dependent industries and industries with high external financing needs appear to benefit the most from being politically connected. The second chapter incorporates a model of endogenous corruption into an intra industry trade model. The purpose is to study how trade liberalization impacts bureaucratic corruption. We find that trade opening leads to tougher competition and thereby reduces the officials ability to extract rents from firms. We also analyze the incentive for governments to fight corruption and find that incentives are stronger when trade costs are lower. Finally, we empirically test the main prediction of the model, and find that more remote and less easily accessible countries also suffer from higher levels of corruption. The third chapter aims at estimating trade creation and trade diversion under the South Asian Free Trade Agreement (SAFTA). Previous studies - mainly conducted prior to the implementation of the treaty - have put into question SAFTA's potential for trade creation. However, according to our estimates, conducted on post treaty data, SAFTA has increased intra regional trade by as much as 40% for eligible products. This figure is higher than estimates for most other trade blocks. Further, trade diversion appears to have been limited, though this is due mainly to the treaty being accompanied by significant reductions in external tariffs.

International Trade, Economic Development and National Welfare

International Trade, Economic Development and National Welfare
Author: Kausik Gupta
Publisher: Taylor & Francis
Total Pages: 265
Release: 2023-03-31
Genre: Business & Economics
ISBN: 1000853748

This book presents a comprehensive analysis of contemporary issues in international trade and economic development. Emphasising the significance of economic development within policymaking, the book covers important issues like the provisioning of public goods, its implication in a liberalised regime, crime and corruption, skilled–unskilled wage inequality, income distribution and unemployment, environmental regulation and role of educational capital and informal sector. The volume deals with the impact that different aspects of international trade and investment are likely to have on the above-mentioned areas. The essays, written to honour the memory of Professor Sarbajit Chaudhuri, also examine topics that focus on public policy related to immigration of skilled workforce, political resistance and political compulsions that a democratic government might face in keeping with its commitment to tariff reforms, gender wage gap and issues related to globalisation, income distribution and unemployment. The book will be of invaluable interest to postgraduate students, scholars and researchers of development economics, international economics and labour economics and to those working on theoretical research on applications of general equilibrium trade models in developing countries.

Essays on International Trade and International Political Economy

Essays on International Trade and International Political Economy
Author: Thomas Zylkin
Publisher:
Total Pages: 294
Release: 2015
Genre: Economics
ISBN:

My graduate research has been organized around two main themes: (i) the causes and consequences of trade integration and (ii) the strategic nature of armed conflict. The expansion of international trade over the past sixty years has played a major role is determining the fates of nations, both for better and for worse, and likewise has the potential to shape our futures in ways we need to be able to anticipate. Similarly, the death, destruction, and diversion of productive resources associated with violent conflict continue to present a critical obstacle to shared prosperity. The papers I am presenting as the chapters of my dissertation are representative of the contributions I am interested in making in these important research areas. My research on trade integration spans both the micro-level of what forms trade integration may take as well as higher level concerns about how freer trade will affect both the world economy as well as the individual economies within it. Two chapters of my dissertation, "Beyond Tariffs: Quantifying Heterogeneity in the Effects of Free Trade Agreements" and "Finding the Influence of Communication on Trade" are devoted to this subject. In "Beyond Tariffs", for example, I show, using NAFTA as an empirical case study, that the effects of free trade agreements on individual nations may not be what we might expect to observe ex ante based on tariffs. Relying solely on tariffs to project NAFTA's effects not only greatly underestimates the overall welfare increases for all three NAFTA countries--Mexico's in particular--but also overstates the positive effects of NAFTA on U.S. producer prices. It follows that "heterogeneity" in the effects of free trade agreements, both within and across agreements, may not be well-understood. In "Finding the Influence of Communication", I investigate whether the sharing of a common language promotes trade in a way similar to trade policy and, if so, what the consequences of increased language learning will be for global trade. Most notably, I find the effect of communication in native languages on trade tends to be underestimated in the absence of controls for communication in non-native languages. Surprisingly, while I find strong evidence for the causal impact of foreign language acquisition on manufacturing trade, I do not find similarly strong evidence for services trade. I also find that, unsurprisingly, adding to the world's population of English speakers has by far the largest impact on trade of any major world language. Interestingly, however, when I remove all non-language barriers to trade, I find the forces of geography and history may have greatly impeded the relative appeal of Chinese as a competing global language. The third chapter of my dissertation, "The Problem of Peace: A Story of Corruption, Destruction, and Rebellion", joint with Constantinos Syropoulos, deals with a different kind of question: what are the economic incentives that drive the emergence of destructive conflicts, and of intra-state conflicts ("civil conflicts") in particular? Specifically, we investigate how the central presence of state (fiscal) institutions in civil conflicts generates unique explanations for the emergence of conflict itself. International trade plays an important role in this chapter as well, but mainly as a backdrop for illustrating the unique trade-offs between "peace" and "welfare" that may arise in this context. It is possible for changes in international prices to move in favor of promoting settlements, but such settlements can be associated with (socially wasteful) increases in arming and/or taxation. We also explore, among other things, how limiting the government's fiscal capacity may tilt the balance towards peaceful settlement.

Corruption and the Global Economy

Corruption and the Global Economy
Author: Kimberly Ann Elliott
Publisher: Columbia University Press
Total Pages: 258
Release: 1997-06-01
Genre: Political Science
ISBN: 0881323233

The recently-adopted OECD convention outlawing bribery of foreign public officials is welcome evidence of how much progress has been made in the battle against corruption. The financial crisis in East Asia is an indication of how much remains to be done. Corruption is by no means a new issue but it has only recently emerged as a global issue. With the end of the Cold War, the pace and breadth of the trends toward democratization and international economic integration accelerated and expanded globally. Yet corruption could slow or even reverse these trends, potentially threatening economic development and political stability in some countries. As the global implications of corruption have grown, so has the impetus for international action to combat it. In addition to efforts in the OECD, the Organization of American States, the World Trade Organization, and the United Nations General Assembly, the World Bank and the International Monetary Fund have both begun to emphasize corruption as an impediment to economic development. This book includes a chapter by the Chairman of the OECD Working Group on Bribery discussing the evolution of the OECD convention and what is needed to make it effective. Other chapters address the causes and consequences of corruption, including the impact on investment and growth and the role of multinational corporations in discouraging bribery. The final chapter summarizes and also discusses some of the other anticorruption initiatives that either have been or should be adopted by governments, multilateral development banks, and other international organizations.

Essays in International Trade and Public Economics

Essays in International Trade and Public Economics
Author: Margarita M. Kalamova
Publisher: Peter Lang Gmbh, Internationaler Verlag Der Wissenschaften
Total Pages: 131
Release: 2012
Genre: Business & Economics
ISBN: 9783631621394

The essays of this book are contributions to the empirical Literature in International Trade and Public Economics. They deal with the relationship between the structure and quality of the public sector and the process of economic integration. Two of the essays add to the empirical determinants of trade and foreign direct investment (FDI) and to the numerous applications of the theory of government decentralization. Decentralization tends to discourage inward FDI and domestic trade and to increase imports and exports. A third essay focuses on the effect of governments' intangible assets - such as consumer perceptions about countries and products from these countries - on FDI. A country's nation brand is shown to have a significant and large positive effect on investment flows.