A country where bribery and corruption are widespread will have higher total factor productivity, ceteris paribus, than a country where bribery and corruption are limited.

Question

Quizplus · Accepted Answer

Bribery and corruption create inefficiencies in the allocation of resources, leading to a misallocation of resources and a decrease in productivity. Therefore, a country with limited bribery and corruption is likely to have higher total factor productivity.

A Country Where Bribery and Corruption Are Widespread Will Have