Friday, March 26, 2010

Does anti-bribery legislation hurt countries, perpetuating bribery?

Anti-bribery legislation in the US, like the FCPA, may serve to deter foreign investment in desperately poor countries.
This actually was something a lot of economists (Cowen, for one, who also gets the hat tip on this article) talked about with Haiti. Companies weren't willing to go into Haiti to provide necessities because they knew they'd never be able to get in without bribing officials, given how much of the infrastructure has collapsed.
I'm not saying we should outright support bribery, but in a strange way, not supporting it may perpetuate it, by keeping them poor. At the very least, it may be worth suspending in the case of temporary crisis (a la Haiti).

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