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Corruption and firm performance: An empirical study on the impact of bribe payments on the performance of Chinese firms

Boukou, Jihane LU (2017) EKHR81 20171
Department of Economic History
Abstract
Corruption is often compared to a double-edged sword. While acting as a “necessary evil” to avoid bureaucratic inefficiencies such as red tape to grease the wheels of commerce, there are many other studies expressing their concerns regarding the negative effects corruption has on growth. Based on previous empirical evidence and theories such as the “rent-seeking” theory that conceptualize the relationship between corruption and firm performance, this paper hypothesizes that Chinese firms that engage in bribery in the form of payments or gifts to government officials have higher levels of firm performance. The hypothesis is empirically analyzed by using a recent dataset provided by the World Bank Enterprise Survey conducted in 2011-2013.... (More)
Corruption is often compared to a double-edged sword. While acting as a “necessary evil” to avoid bureaucratic inefficiencies such as red tape to grease the wheels of commerce, there are many other studies expressing their concerns regarding the negative effects corruption has on growth. Based on previous empirical evidence and theories such as the “rent-seeking” theory that conceptualize the relationship between corruption and firm performance, this paper hypothesizes that Chinese firms that engage in bribery in the form of payments or gifts to government officials have higher levels of firm performance. The hypothesis is empirically analyzed by using a recent dataset provided by the World Bank Enterprise Survey conducted in 2011-2013. The results present some interesting findings. Firms that perceive the court system to be corrupted and firms that perceive it to be non-corrupted both achieve growth in firm performance. This implies that corruption does not contribute negatively to Chinese firm growth at all. (Less)
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author
Boukou, Jihane LU
supervisor
organization
course
EKHR81 20171
year
type
H1 - Master's Degree (One Year)
subject
keywords
Corruption, bribery, firm performance, China
language
English
id
8924030
date added to LUP
2017-09-07 12:54:16
date last changed
2017-09-07 12:54:16
@misc{8924030,
  abstract     = {Corruption is often compared to a double-edged sword. While acting as a “necessary evil” to avoid bureaucratic inefficiencies such as red tape to grease the wheels of commerce, there are many other studies expressing their concerns regarding the negative effects corruption has on growth. Based on previous empirical evidence and theories such as the “rent-seeking” theory that conceptualize the relationship between corruption and firm performance, this paper hypothesizes that Chinese firms that engage in bribery in the form of payments or gifts to government officials have higher levels of firm performance. The hypothesis is empirically analyzed by using a recent dataset provided by the World Bank Enterprise Survey conducted in 2011-2013. The results present some interesting findings. Firms that perceive the court system to be corrupted and firms that perceive it to be non-corrupted both achieve growth in firm performance. This implies that corruption does not contribute negatively to Chinese firm growth at all.},
  author       = {Boukou, Jihane},
  keyword      = {Corruption,bribery,firm performance,China},
  language     = {eng},
  note         = {Student Paper},
  title        = {Corruption and firm performance: An empirical study on the impact of bribe payments on the performance of Chinese firms},
  year         = {2017},
}