Abstract: "Would reducing corruption increase trade? While corrupt customs
officials extorting bribes from exporters may impede trade, those who take
bribes to circumvent formal trade barriers may help it. This column estimates
that when tariffs exceed 25%, the pro-trade effects of corruption may dominate."
Love the concept! You can extend it to other situations.
Corruption has a bad reputation because inter alia, the briber is believed to have received an exorbitant privilege for having the right connections. Let's call this "unfair" form of corruption. But there are more "fair" or "equal opportunity" versions of corruption. For example, imagine a situation in which corruption gets something done faster. Imagine if everyone has the option of paying a bribe of varying degrees to speed up a business application. This should actually result in greater allocation efficiency, because the most productive people/companies would get more done. This is the norm in the private sector, but even existent in the public sector in developed nations. (Of course, sometimes pure economic justifications violate other qualities we cherish. And it assumes the distribution of wealth and resources are fair to begin with and not the result of excess corruption.)
I had a bit of an experience with a situation earlier this month, when I lost my passport on Saturday coming into Dulles airport. I needed a new passport for my return to China the next Monday (5 business days). Going through the official State Department channels for urgent requests, the earliest I could get an appointment was Friday in Boston and New York, or Wednesday if I could travel to Connecticut. However, a quick Google search finds dozens of passport agencies that can get a passport from the State Department within 24-48 hours for a hefty fee ($200-$300 plus government charges). Fortunately, my passport was turned into lost and found just before I submitted my new passport application.
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