Quarterly Journal of Political Science > Vol 16 > Issue 4

"Leakage" in International Regulatory Regimes: Did the OECD Anti-bribery Convention Increase Bribery?

Terrence L. Chapman, The University of Texas at Austin, USA, t.chapman@austin.utexas.edu , Nathan M. Jensen, The University of Texas at Austin, USA, natemjensen@austin.utexas.edu , Edmund J. Malesky, Duke University, USA, ejm5@duke.edu , Scott Wolford, The University of Texas at Austin, swolford@austin.utexas.edu
Suggested Citation
Terrence L. Chapman, Nathan M. Jensen, Edmund J. Malesky and Scott Wolford (2021), ""Leakage" in International Regulatory Regimes: Did the OECD Anti-bribery Convention Increase Bribery?", Quarterly Journal of Political Science: Vol. 16: No. 4, pp 387-427. http://dx.doi.org/10.1561/100.00019193

Publication Date: 18 Oct 2021
© 2021 T. L. Chapman, N. M. Jensen, E.J. Malesky and S. Wolford
Comparative political economy,  International political economy,  Formal modelling,  International organization,  Political corruption,  Industrial Organization:Regulatory Economics
CorruptionbriberyOECD Anti-Bribery ConventionVietnamlist experiment


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In this article:
Regulatory Leakage 
The OECD Anti-bribery Convention 
Empirical Analysis 


When do well-intended regulatory regimes have unintended consequences? We examine one obstacle to successful regulation, "regulatory leakage," in the context of the OECD Anti-Bribery Convention (ABC). Leakage occurs when regulated behavior decreases for actors under a regime's jurisdiction, but increases among those outside of it. We analyze a formal model that demonstrates how the ABC may simultaneously reduce bribery among firms from member countries, while increasing bribery by firms from non-ABC member countries. We also show how the ABC may lead firms from ABC member countries to shift to bribery through intermediaries. New empirical evidence of MNC activity in Vietnam shows evidence of both regulatory leakage and bribery through intermediaries.