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In this study, we investigate the relationship between ownership structure, corruption, and capital investments in firms operating in a selected sample of Sub‐Saharan Africa (SSA) countries. Using a sample of an unbalanced panel of firms over different time periods that ranged from 2003 to 2016, and estimating with the fixed effects technique, we find that foreign ownership and bribery payments have positive and negative effects, respectively, on the capital investment of firms. Furthermore, the marginal effects analysis reveals that the effects of ownership structure and bribery payments differ significantly across our selected sample of countries and across different firm sizes. Policy implications were deduced from the findings.

This paper contributes to the literature on capital flight by investigating the relationship between kidnapping rate and capital flight in developing countries. Numerous empirical studies exist on the determinants of capital flight but, surprisingly, none of them have investigated the empirical link between kidnapping and capital flight. To fill this existing void in the literature, this paper utilised a sample of 67 developing countries for the period 2003–2017. Estimates of the GMM technique show that kidnapping rate has a positive and significant impact on capital flight. However, estimations of the marginal differences show that this significant effect remained consistent only in the sample of ‘fragile’ developing countries. The results remained consistent to alternative measures of capital flight.

Nigeria is one of the countries in Sub-Saharan Africa (SSA) that has faced high incidents of kidnapping. As a result of that, some studies have investigated its determinants and economic consequences in Nigeria. However, no study is yet to investigate its impact on the foreign ownership of firms. This is a research void that this article has attempted to fill. Using the World Bank Enterprise Survey and the United Nations Office on Drugs and Crime, we found empirical evidence of the negative impact of kidnapping on the foreign ownership of firms. An increase in the kidnapping rate by one (1 per 100,000 of population) will reduce the foreign ownership of firms by 4.855-10.098% depending on the econometric model. There is also empirical evidence that the impact of kidnapping on foreign ownership will vary by geographical regions in Nigeria and by firm size. Policy implications were deduced from our findings.

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