Corruption, regulation, and investment incentives
研究了可能产生负面社会影响的创新活动的最优监管设计，比较了宽松授权和严格授权两种制度，发现腐败在制度选择中起关键作用，且在一定条件下腐败可能提高社会福利。
We study the optimal design of regulation for innovative activities which can have negative social repercussions. We compare two alternative regimes which may provide firms with different incentives to innovate and produce: lenient authorization and strict authorization. We find that corruption plays a critical role in the choice of the authorization regime. Corruption exacerbates the costs of using lenient authorization, under which production of socially harmful goods is always authorized. In contrast, corruption can be socially beneficial under strict authorization, since it can mitigate an over-investment problem. Hence, more pervasive corruption favors the adoption of a strict authorization regime and may increase welfare.