Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5092388 | Journal of Comparative Economics | 2014 | 19 Pages |
Abstract
This study shows that for firms in the Latin America and Caribbean region, bribery significantly distorts firm growth. Firms that were solicited for bribes when conducting business transactions - such as applying for permits, electricity, or water connections - have 23% lower annual sales growth than firms that do not face such solicitations. Moreover, these distortions are more severe for low-revenue-generating and young firms. Using the instrumental variables method on cross-sectional data as well as evidence from panel data, the authors show that these results are robust to different specifications and the use of different sub-samples.
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Authors
Murat Åeker, Judy S. Yang,