Corruption And Productivity : Firm-Level Evidence From The BEEPS Survey

Rosa, Donato De; Gooroochurn, Nishaal; Görg, Holger

doi:10.1596/1813-9450-5348

Cited by 86 publications

(78 citation statements)

References 54 publications

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“…De Rosa et al (2010) find that corruption has a negative effect on firm productivity in Central and Eastern European countries. Hillman and Krausz (2004) show that corruption brings short term performance advantages.…”

Section: Theoretical Literaturementioning

confidence: 99%

Corruption and Stock Market Development: New Evidence from GCC Countries

Aljazaerli

Sirop

Mouselli

2016

Business: Theory and Practice

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The theoretical relationship between corruption and stock market development has been debated quite extensively in the literature, yet the evidence on the impact of corruption on stock market development remains contradictory and ambiguous. This paper investigates the impact of corruption, as measured by Corruption Perception Index (CPI) published by Transparency International, on stock market development focusing exclusively on Gulf Cooperation Council (GCC) countries with its special characteristics of combining richness with relatively high level of corruption. Results from an estimation of alternative regression models on a panel of six GCC countries over the period 2003–2011, through which CPI is legitimately comparable, confirms a positive impact of corruption on stock market development, where the latter is measured by market capitalization. This is consistent with the view that corruption greases the wheels of economy by expediting transactions and allowing private firms to overcome governmentally imposed inefficiencies.

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Section: Theoretical Literaturementioning

confidence: 99%

Corruption and Stock Market Development: New Evidence from GCC Countries

Aljazaerli

Sirop

Mouselli

2016

Business: Theory and Practice

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“…Hence, EMEs operating in host countries with well-developed IPR laws can reduce the probability of imitation and protect their innovation output. Finally, corruption depresses investment in R&D because it increases uncertainty, transaction costs and the risk of expropriation (De Rosa, Gooroochurn & Görg, 2010). Therefore, in host countries with stronger institutional development, EMEs can capitalize on institutional advantages to develop stronger technological capabilities (Makino, Lau & Yeh, 2002;Wu, 2013).…”

Section: Host Country Institutional Development and Emes' Innovation mentioning

confidence: 99%

Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development

Wang

Jiang

et al. 2016

Journal of World Business

243

152

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We examine how host-country institutional development influences innovation performance of internationalized emerging market enterprises (EMEs). Our panel-data analysis of Chinese EMEs shows that although host-country institutional development on average enhances innovation performance of the parent, such effects are more pronounced for EMEs with strong absorptive capacity and for those diversifying into a larger number of countries. Interestingly, EMEs with a higher level of state ownership gain more when entering countries with a lower level of institutional development. Our findings offer insights regarding how latecomer EMEs should configure their portfolio of subsidiaries in order to enhance innovation performance of their parent.

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“…Méon and Weill (2010), for example, find evidence that corruption is an efficient grease in the economy for countries with less effective institutions, whereas Méon and Sekkat (2005) find the opposite result that corruption is detrimental under the same conditions. Focusing specifically on CEE countries, De Rosa, Gooroochurn and Görg (2010) show that bribery does not emerge as a second-best option to achieve higher firm productivity in order to circumvent institutional deficiencies. We too therefore attempt to test the "grease-the-wheel" hypothesis empirically.…”

Section: The Detailed Empirical Specificationmentioning

confidence: 99%

“…6 We therefore measure the "intensity" of bribery at the country-sector level rather than simply the "participation" in bribery, which is what De Rosa, Gooroochurn and Görg (2010) instead capture by taking binary 1/0 variables on the basis of these questions. 7 Fungacova, Kochanova and Weill (2015) and Hanousek and Kochanova (2015) define the BEEPS questions on bribery we employ in this paper as the most neutral and less subject to perception bias.…”

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confidence: 99%

Is Corruption Efficiency-Enhancing? A Case Study of Nine Central and Eastern European Countries

et al. 2016

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may CompNet AbstractWe investigate the role of corruption in the business environment in explaining the efficiency of withinsector production factor allocation across firms in nine Central and Eastern European countries in the period [2003][2004][2005][2006][2007][2008][2009][2010][2011][2012]. Using a conditional convergence model, we find evidence of a positive relationship between corruption growth and both labour and capital misallocation dynamics, once country framework conditions are controlled for: the link between corruption and input misallocation dynamics is larger the smaller the country, the lower the degree of political stability and of civil liberties, and the weaker the quality of its regulations. As input misallocation is one of the determinants of productivity growth, we further show that the relationship between changes in corruption and TFP growth is indeed negative. Our results hold when we tackle a possible omitted variable bias by instrumenting corruption with two instrumental variables (the percentage of women in Parliament and freedom of the press).Keywords: bribes, capital misallocation, labour misallocation, total factor productivity JEL codes: D24, D73, O47ECB Working Paper 1950, August 2016 1 Non-technical summaryIn this paper we investigate how changes in corruption in the business environment may affect total factor productivity (TFP) growth by influencing the efficiency of the allocation of both capital and labour across firms in nine Central and Eastern European (CEE) countries in the period 2003-2012.The macroeconomic impact of corruption is well documented in the literature. Empirical studies show mixed results, supporting both the view that (i) corruption has the potential to foster economic development in that it constitutes the necessary "grease" to lubricate the stiff wheels of rigid government administration and legal framework, as well as the alternative view that (ii) the rent-seeking behaviour of corrupt officials might reduce economic performance, as promoted by the "sand-the-wheels" advocates.There is also a vast, yet inconclusive, literature on the possible impact of corruption on TFP via the input allocation channel. While some authors argue that corruption may promote allocative efficiency since only the most efficient and profitable firms can afford to pay bribes to obtain government services, others point out that corruption might promote sub-optimal choices with regard ...

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Corruption And Productivity : Firm-Level Evidence From The BEEPS Survey

Cited by 86 publications

References 54 publications

Corruption and Stock Market Development: New Evidence from GCC Countries

Corruption and Stock Market Development: New Evidence from GCC Countries

Internationalization and innovation performance of emerging market enterprises: The role of host-country institutional development

Is Corruption Efficiency-Enhancing? A Case Study of Nine Central and Eastern European Countries

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