Bribery and the Foreign Corrupt Practices Act (FCPA)

Corruption

Bribery contributes to the overall prevalence of corrupt practices

Allocation of resources and products

Bribery distorts the distribution of resources and goods

Higher costs

Bribery leads to increased expenses for certain groups, including firms and individuals

Non-governmental bribes

Bribes that are not covered by the FCPA

Level the playing field

Goal of FCPA to create fair competition among all competitors

Model example

Goal of FCPA to set a standard for other countries to follow

Foreign Corrupt Practices Act (FCPA)

Legislation prohibiting bribery of higher government officials in foreign countries

Inefficiencies

Negative consequences caused by bribery, such as wasteful use of resources

Small grease payments

Payments made to lower government officials that are not considered illegal under FCPA