The aim of the thesis is to create a RBC model incorporating corrupting sector. The thesis contributes to the few existing DSGE models with corruption by introducing the corrupting sector into the sector of firms and political parties which is regarded as a sector of public procurements where firms bribe politicians for gaining public tenders. This setting is new and is supposed to catch better the phenomenon of political corruption. The model predicts that all shocks that positively affect the economy motivate firms to invest more into the bribes and vice versa. The increase of the overall level of corruption stimulates economy but is leading an economy to the instability. The model also examines the effect of various forms of fiscal spending in the households ' utility function. The model exhibits several non-intuitive results (too high portion of stolen money by firms, stimulation of the economic performance caused by higher corruption and negative holding of government bonds) that should be solved in next research.
| Identifer | oai:union.ndltd.org:nusl.cz/oai:invenio.nusl.cz:304452 |
| Date | January 2012 |
| Creators | Paulus, Michal |
| Contributors | Baxa, Jaromír, Gregor, Martin |
| Source Sets | Czech ETDs |
| Language | English |
| Detected Language | English |
| Type | info:eu-repo/semantics/masterThesis |
| Rights | info:eu-repo/semantics/restrictedAccess |
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