Corruption, political competition and environmental policy

Abstract

This paper examines the interplay between corruption, political competition, environmental policy and environmental outcomes. An important feature of the model, which has been neglected in the existing literature, is that corruption may occur at different levels of government, such as the payment of bribes to politicians who determine policies, or bureaucrats who administer environmental regulations. We analyse the relationship between political competition and environmental outcomes in a model of stratified corruption and identify the benefits and limits of political competition. Our results suggest that while political competition may yield policy improvements, it cannot eliminate corruption at all levels of government.