Dundee Discussion Papers in Economics 112: Hierarchies, incentives and collusion in a model of enforcement

TY - UNPB

T1 - Dundee Discussion Papers in Economics 112

T2 - Hierarchies, incentives and collusion in a model of enforcement

AU - Mishra, Ajit

N1 - This paper was also published by Elsevier in Journal of Economic Behavior & Organization, Vol.47 (2), pp.165-178

PY - 2000

Y1 - 2000

N2 - This paper considers a model of enforcement with corruptible enforcers in an agency framework. We examine how supervisor’s choice of effort and honesty are influenced by incentives (penalty and reward schemes) and organizational structure. We consider both vertical hierarchies (corrupt supervisor monitoring another) and horizontal structures where more than one corrupt supervisor monitor the agent. The latter tend to induce less corruption but need not welfare dominate the vertical hierarchies. The organizational structure matters most when there are constraints on rewards and penalties.

AB - This paper considers a model of enforcement with corruptible enforcers in an agency framework. We examine how supervisor’s choice of effort and honesty are influenced by incentives (penalty and reward schemes) and organizational structure. We consider both vertical hierarchies (corrupt supervisor monitoring another) and horizontal structures where more than one corrupt supervisor monitor the agent. The latter tend to induce less corruption but need not welfare dominate the vertical hierarchies. The organizational structure matters most when there are constraints on rewards and penalties.

KW - Corruption

KW - Hierarchies

KW - Monitoring

M3 - Discussion paper

T3 - Dundee Discussion Papers in Economics

BT - Dundee Discussion Papers in Economics 112

PB - University of Dundee

ER -