Legal Standards, Enforcement and Corruption

Giovanni Immordino and Marco Pagano

No 914, EIEF Working Papers Series from Einaudi Institute for Economics and Finance (EIEF)

Abstract: Stricter laws require more incisive and costlier enforcement. Since enforcement activity depends both on available tax revenue and the honesty of officials, the optimal legal standard of a benevolent government is increasing in per-capita income and decreasing in officials’ corruption. In contrast to the “tollbooth view” of regulation, the standard chosen by a self-interested government is a non-monotonic function of officials’ corruption, and can be either lower or higher than that chosen by a benevolent regulator. International evidence on environmental regulation show that standards correlate positively with per-capita income, and negatively with corruption, consistently with the model’s predictions for benevolent governments.

Pages: 45 pages
Date: 2009, Revised 2009-10
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Related works:
Journal Article: Legal Standards, Enforcement, and Corruption (2010)
Working Paper: Legal Standards, Enforcement and Corruption (2009)
Working Paper: Legal Standards, Enforcement and Corruption (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:eie:wpaper:0914

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