other than a friendly visit. Chance conversations are possible – an ideal place to meet and subtly explore.

Before a deal can be done between the principals in a corrupt transaction, they might use intermediaries to prepare the terrain. Intermediaries are matchmakers. They know corrupt people. They may have long-lasting relationships with multiple parties on both sides and are thus able to build trust. In some contexts their contacts and relationships may even allow them to be more stable partners than changing top policymakers or changing CEOs. (Think “Klaus Schwab” and “World Economic Forum” for a legitimate variant of matchmaking.) The use of intermediaries also allows the principal some plausible deniability until the final deal is closed. They might get their income from fees that can look legitimate – the “consulting fee” - without actually participating directly in grand corruption. In fact, intermediaries may command extra trust, if they stick to their normal “fee schedule” and clearly stay away from asking for a special cut in deals.

Deal clinching meetings follow. In one case, the CEO of an engineering company sought to meet the managing director of a large public enterprise. After long periods of petitioning for a meeting and waiting, he finally was ushered into the office of the managing director, who sat in his chair behind the desk and faced the wall. For four hours he remained in silence while the radio played. Then he turned. A deal was closed in the ensuing meeting<sup>5</sup> . At first sight such behavior is bizarre. Yet, “waiting games” may serve two functions. They select people who are interested to wait and thus seem sufficiently desperate for a deal. Silence also serves to place pressure on the waiting party to show his hand, possibly by offering a “good deal”, thereby revealing willingness to enter into corrupt relations. At the same time offering to make corrupt payments provides a form of compromising evidence that exposes the briber<sup>6</sup> .

The complex process of match-making explains some prima facie “weird” behavior. It also means that it takes time. The only study I am aware of about the actual transaction costs (excluding technical or legal studies) of making deals for large private infrastructure projects shows these costs can be substantial. Accordingly, normal transaction costs tend to amount to some 3 percent of project cost, whereas in complicated environments these costs can go often to 10 percent or more (Klein, So and Shin 1996). The extra costs are essentially due to time wasted by highly paid lawyers or contractors waiting for meetings, not extra costs of writing complex contracts. It is normal to argue that the time spent so inefficiently demonstrates the low capacity of some governments or their disorganization and lack of political direction. In fact, it may be that the same observable phenomena reflect rational strategies to explore the potential for corrupt transactions.

> 5 I have no evidence that corrupt payments played a role.  Yet, the behavior would just be bizarre, if it was not at least an attempt to assess the readiness to be corrupt.

> 6 The typical strategy to elicit bribes in the Hotel I used to stay in in Lagos would be to let arriving visitors wait without giving them the room they booked.

6