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Open Access Publications from the University of California

Combating Political Corruption with Policy Bundles

Published Web Location

https://doi.org/10.26085/C3PC7X
Abstract

In this paper, we develop a dynamic model of politicians who can engage in corruption. The model offers important insights into what determines corruption and how to design policy to combat it. We estimate the model using data from Brazil to measure voters' willingness to pay for various commonly-proposed anti-corruption policies, such as increasing audit probabilities, increasing politicians' wages, and extending term limits. We document that while voters have a high willingness to pay for audit policies, due to their effectiveness in reducing corruption, policymakers should instead adopt a multi-pronged approach. By bundling certain policies, we can achieve similar welfare gains at fractions of the costs.

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