The objective of this proposed project is to analyze certain aspects of corruption, when such contractual relationships have to be self-enforcing. The sustainability of a self-enforcing corrupt relationship depends on the amount of information the involved parties have about each other. Hence, when evaluating the effectiveness of anti-corruption policies one should consider how they affect the flow of information between the involved parties, i.e. they might facilitate or garble informational flows. Such considerations might be important especially when the informational flows generated by the interactions among corrupt parties are localized, while the implemented policies affect uniformly the entire population. Moreover, corruption may create inertia that hinder the adoption of beneficial organizational innovations, especially when the agents of an organization can not be forced to implement them. To the extent that such innovations reduce corruption opportunities, their adoption might meet opposition which is too costly to "buy-out".