2017
DOI: 10.1111/ecoj.12560
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Firm Growth and Corruption: Empirical Evidence from Vietnam

Abstract: This paper tests whether firm growth reduces corruption, using data from over 10,000 Vietnamese firms. We employ instrumental variables based on growth in a firm's industry in other provinces within Vietnam and in China. We find that firm growth reduces bribes as a share of revenues. We propose a mechanism for this effect whereby government officials' decisions about bribes are modulated by inter-jurisdictional competition. This

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Cited by 115 publications
(86 citation statements)
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References 29 publications
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“…The introduction of human capital leads the elasticity of steady-state output with respect to the investment rate to be higher than in the standard Solow model. 7 In a related pa- 4 The implications of the Gourinchas and Jeanne (2006) analysis for the study of foreign aid were previously discussed in Temple (2010) In contrast to our approach, some discussions of virtuous circles see them as tightly connected to multiple equilibria. Fast growth can arise in moving from one equilibrium to another, and this may involve dynamic adjustments which reinforce one another.…”
Section: Discussionmentioning
confidence: 92%
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“…The introduction of human capital leads the elasticity of steady-state output with respect to the investment rate to be higher than in the standard Solow model. 7 In a related pa- 4 The implications of the Gourinchas and Jeanne (2006) analysis for the study of foreign aid were previously discussed in Temple (2010) In contrast to our approach, some discussions of virtuous circles see them as tightly connected to multiple equilibria. Fast growth can arise in moving from one equilibrium to another, and this may involve dynamic adjustments which reinforce one another.…”
Section: Discussionmentioning
confidence: 92%
“…similar ideas can be applied to foreign aid, even when aid is amplified by a capital externality or helps a recipient country to escape from a medium-run poverty trap. 4 We now discuss amplification effects and virtuous circles in more detail. An example of amplification is that, for a given capital-output ratio, the long-run elasticity of output with respect to TFP is greater than unity in the Solow and Ramsey models.…”
Section: Discussionmentioning
confidence: 99%
“…Vietnam's transition from a planned to a market economy was and still is driven by economic liberalization and, thus, massive Foreign Direct Investment (FDI) flows and an overall modernization of industry accompanied by the emergence of the private sector (Bloomberg, 2015;Mishra, 2011;Waibel, 2009). Since then, about 350,000 private companies are operating in a range of sectors from food processing, light manufacturing like garment and textile production and sophisticated financial services in Vietnam (Bai, Jayachandran, Malesky, & Olken, 2017).…”
Section: Study Area -Ho Chi Minh City Vietnammentioning
confidence: 99%
“…In 2010, the total tonnage accounted for 6-6.5 million DWT; the number made up 8.5-9.5 million DWT in 2015. It is forecasted to reach 11.5-13.5 million DWT in 2020 [8,9].…”
Section: Introductionmentioning
confidence: 99%