Complex Dynamics in a Growth Model with Corruption in Public Procurement
We study the relationship between corruption in public procurement and economic growth within the Solow framework in discrete time, while assuming that the public good is an input in the productive process and that the State fixes a monitoring level on corruption. The resulting model is a bidimensio...
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| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Wiley
2011-01-01
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| Series: | Discrete Dynamics in Nature and Society |
| Online Access: | http://dx.doi.org/10.1155/2011/862396 |
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| Summary: | We study the relationship between corruption in public procurement and economic growth
within the Solow framework in discrete time, while assuming that the public good is an input in
the productive process and that the State fixes a monitoring level on corruption. The resulting
model is a bidimensional triangular dynamic system able to generate endogenous fluctuations
for certain values of some relevant parameters. We study the model from the analytical point
of view and find that multiple equilibria with nonconnected basins are likely to emerge. We
also perform a stability analysis and prove the existence of a compact global attractor. Finally,
we focus on local and global bifurcations causing the transition to more and more complex
asymptotic dynamics. In particular, as our map is nondifferentiable in a subset of the states
space, we show that border collision bifurcations occur. Several numerical simulations support
the analysis. Our study aims at demonstrating that no long-run equilibria with zero corruption
exist and, furthermore, that periodic or aperiodic fluctuations in economic growth are likely to
emerge. As a consequence, the economic system may be unpredictable or structurally unstable. |
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| ISSN: | 1026-0226 1607-887X |