Corruption Factors

Among the factors that give rise to corruption, it is suggested that three groups be distinguished: fundamental factors rooted in the imperfection of economic institutions and economic policy, organizational factors ("weakness of the government"), and societal factors that depend on the prehistory and are connected with the mass culture and norms of bureaucratic behavior. A model in which corruption equilibrium is supported by non-optimum tax policy or by slow technical progress is compared with a "societal" model, which has two Nash equilibria of the level of corruption. Recommendations for combating corruption stemming from analysis of the models are discussed.