Corruption: A Misesian Economic Analysis

Abstract

What is corruption? The aim of this paper is to present and analyze selected theoretical definitions of corruption, to point out their implicit characteristics, and to incorporate these characteristics into a Misesian positive theoretical apparatus. Within this analysis, I argue that Ludwig von Mises was the first to recognize the importance of distinguishing among different institutional frameworks where human action, referred to as corruption, may take place. Then I present a critical reflection on the implementation of the market’s “auto regulation mechanisms” into bureaucratic management in order to eliminate corrupt actions.