'Plata O Plomo?': Bribe and Punishment in a Theory of Political Influence

36 Pages Posted: 21 Nov 2002

See all articles by Ernesto Dal Bo

Ernesto Dal Bo

University of California, Berkeley - Haas School of Business - Business and Public Policy

Pedro Dal Bo

Brown University - Department of Economics

Rafael Di Tella

Harvard Business School - Business, Government and the International Economy Unit; National Bureau of Economic Research (NBER)

Date Written: November 2002

Abstract

We present a model where groups attempt to exert influence on policies using both bribes (plata, Spanish for silver) and the threat of punishment (plomo, Spanish for lead). We then use it to make predictions about the quality of a country's public officials and to understand the role of institutions granting politicians with immunity from legal prosecution. The use of punishment lowers the returns from public office and reduces the incentives of high ability citizens to enter public life. Cheaper plomo and more resources subject to official discretion are associated with more frequent corruption and less able politicians. Moreover, the possibility of punishment changes the nature of the influence game, so that even cheaper plata can lower the ability of public officials. Protecting officials from accusations of corruption (immunity) will decrease the frequency of corruption and may increase the quality of politicians if the judiciary is weak. These predictions are the opposite to those emerging from a model where only bribes are used.

Keywords: Lobbying, Threats, Quality of Policymakers, Official Immunity

JEL Classification: D72, D78, K4

Suggested Citation

Dal Bo, Ernesto and Dal Bo, Pedro and Di Tella, Rafael, 'Plata O Plomo?': Bribe and Punishment in a Theory of Political Influence (November 2002). Available at SSRN: https://ssrn.com/abstract=348721 or http://dx.doi.org/10.2139/ssrn.348721

Ernesto Dal Bo

University of California, Berkeley - Haas School of Business - Business and Public Policy ( email )

Berkeley, CA 94720
United States

Pedro Dal Bo (Contact Author)

Brown University - Department of Economics ( email )

64 Waterman Street
Providence, RI 02912
United States
401-863-2953 (Phone)
401-863-1970 (Fax)

HOME PAGE: http://www.econ.brown.edu/fac/Pedro_Dal_Bo/

Rafael Di Tella

Harvard Business School - Business, Government and the International Economy Unit ( email )

Cambridge, MA
United States
617-495-5048 (Phone)
617-496-5985 (Fax)

HOME PAGE: http://www.people.hbs.edu/rditella/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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