Corruption and firm behavior: Evidence from African ports

Sequeira, Sandra; Djankov, Simeon

doi:10.1016/j.jinteco.2014.08.010

Cited by 143 publications

(86 citation statements)

References 27 publications

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“…Indeed, any alternatives to formal contracts such as informal contracts and reputation games would require downstream firms to have many potential input suppliers. More generally, our estimates of the impact of corruption on management practices corroborate the findings of Sequeira and Djankov (2014), who find that corruption significantly affects the production choices of firms. In the context of bribery payments at African ports, they find that firms are willing to use alternative road trips and pay higher (real) trucking costs to avoid higher bribes.…”

Section: Article In Presssupporting

confidence: 87%

Corruption and management practices: Firm level evidence

Athanasouli

Goujard

2015

Journal of Comparative Economics

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Available online xxx JEL Classfication: H11 K42 L2 Keywords: Management Institutions Corruption Firm governance a b s t r a c t Athanasouli, Daphne, and Goujard, Antoine-Corruption and management practices: Firm level evidenceWe argue that corruption can decrease aggregate productivity by deteriorating firm management practices. We investigate the impact of regional corruption on the management quality of firms within the manufacturing sector in Central and Eastern Europe. The empirical challenge is that bureaucrats' bribing practices may evolve in response to firm behaviors, and that regional corruption is measured with error. To identify causal effects, our preferred specifications use a difference-in-differences methodology. We measure the manufacturing industries' exposure to corruption using their level of dependence to contract institutions. Controlling for regional and manufacturing industry -country fixed effects, we find that firms in more contract dependent industries, located in more corrupt regions, tend to have lower management quality, a more centralized decision-making process, and a lower level of education among administrative staff. In more corrupt regions, contract dependent firms are also characterized by lower investment in R&D, and smaller product markets. We show that our findings are not likely to be driven by omitted variables, outliers, or reverse causality. Journal of Comparative Economics 000 () (2015) 1-21.

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Section: Article In Presssupporting

confidence: 87%

Corruption and management practices: Firm level evidence

Athanasouli

Goujard

2015

Journal of Comparative Economics

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“…The literature is divided on whether higher tariff rates increase incentives for tariff evasion to occur (Allingham and Sandmo 1972;Clotfelter 1983;Panagaryia 1996;Poterba 1987;Gatti 1999;Fisman and Wei 2004;Mishra, Subramanian, and Topalova 2008;Sequeira and Djankov 2014) or if lower tariffs increase private agents' ability to pay higher bribes through an income effect (Feinstein 1991;Slemrod and Yitzhaki 2002). The findings in this paper lend support to the hypothesis that higher tariffs are associated with higher tariff evasion, with limited income effects.…”

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confidence: 59%

“…A growing literature argues that it is not only the level of trade costs but the uncertainty around them that is detrimental to business performance ( Hallward-Driemeier, Khun-Jush, and Pritchett 2012; Sequeira and Djankov 2014;Handley and Limao 2015). I therefore test whether the change in tariffs affected trade costs by changing other moments of the bribe distribution, namely the variance of bribe payments.…”

Section: G Changes In Other Moments Of the Distribution Of Bribe Paymentioning

confidence: 96%

“…In this setting, there appeared to be limited stigma attached to the payment of bribes to border officials, since clearing agents saw the bribe as a necessary payment made at the request of their client firms. Acting as mere intermediaries, clearing agents felt limited moral responsibility for their actions (Sequeira 2012;Sequeira and Djankov 2014). To directly test for misreporting, clearing agents were randomly assigned to being shadowed by surveyors during the clearance process.…”

Section: B Corruption: Evidence From Primary Data On Bribe Paymentsmentioning

confidence: 99%

“…The audit study captured whether a bribe payment was of the collusive type (i.e., if the rent generated from the illicit transaction was shared between the public official and the firm), or coercive in nature (i.e., if the rent was mostly captured by the public official) (Sequeira and Djankov 2014). I replace the dependent variable in equation (5) with a binary variable representing the probability of paying a coercive bribe, conditional on the payment of a bribe.…”

Section: F Displacement Effectsmentioning

confidence: 99%

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Corruption, Trade Costs, and Gains from Tariff Liberalization: Evidence from Southern Africa

Sequeira

2016

American Economic Review

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100

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This paper exploits quasi-experimental variation in tariffs inTrade elasticities play a central role in standard models of trade by determining the effects of policy interventions and the calculation of gains from trade (Hillberry and Hummels 2013; Arkolakis, Costinot, and Rodriguez-Clare 2012). Yet in practice, we still lack reliable estimates of this elasticity. Approaches that rely mostly on time-series variation in trade costs tend to estimate elasticities in the range of one or smaller, while cross-sectional analyses estimate elasticities of five or higher (Baier and Bergstrand 2001;Broda and Weinstein 2006;Romalis 2007;Hillberry and Hummels 2013;Caliendo and Parro 2015). The standard explanations for this discrepancy range from attenuation bias due to measurement challenges and the endogeneity of trade costs (Trefler 1993), to the fact that the two approaches exploit different sources of variation: the time-series work exploits short-run adjustments to changes in trade costs, while the cross-sectional studies reflect more long-run effects of differential levels of trade costs across industries or countries (Goldberg

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Public corruption and the allocation of government contracts

Wei

Zhu

2021

Rev Financ Econ

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Public corruption in the government procurement process is rampant and its cost is huge, even among developed countries. Some scholars estimate that about 20%–30% of the values of government projects are lost due to public corruption. In this paper, we examine how public corruption impacts the allocation of U.S. federal contracts. Using the U.S. Department of Justice corruption convictions data and the federal contract data from 2000 to 2018, we find that firms located in more corrupt states receive more federal contract dollars, more important contracts in terms of their contributions to firm revenues, and contracts with higher visibility among federal contractors. We construct an influence/favoritism index that takes into account defense contracts, cost‐plus contracts, and multi‐year contracts, and document that the index is positively related to corruption levels. These results hold after we conduct several robustness tests, including 2SLS regressions, propensity‐score matching analysis, and using alternative corruption measures. Our empirical findings are consistent with the hypothesis that corruption plays an important role in how federal contracts are allocated.

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Corruption and firm behavior: Evidence from African ports

Cited by 143 publications

References 27 publications

Corruption and management practices: Firm level evidence

Corruption and management practices: Firm level evidence

Corruption, Trade Costs, and Gains from Tariff Liberalization: Evidence from Southern Africa

Public corruption and the allocation of government contracts

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