Understanding corruption and firm responses in cross-national firm-level surveys
By Nathan M. Jensen, Quan Li, Aminur Rahman. 2010
201 citations recorded by the source corpus.
The issue of corruption is important to politicians, citizens, and firms. Since the early 1990s, a large number of studies have sought to understand the causes and consequences of corruption employing firm-level survey data from various countries. While insightful, these analyses have largely ignored two important potential problems: nonresponse and potential false response by the firms. We argue that in politically repressive environments, firms use nonresponse and potential false response as self-protection mechanisms. Corruption is likely understated in such countries. We test our argument using the World Bank enterprise survey data of more than 44,000 firms in 72 countries for the period 2000–2005. We find that firms in countries with less press freedom are more likely to provide nonresponse and false response on the issue of corruption. Therefore ignoring these systematic biases in firms’ responses could result in serious underestimation of the severity of corruption in politically repressive countries. More important, these biases are a rich and underutilized source of information on the political constraints faced by the firms. Firm managers can better evaluate levels of corruption, not only by truthful answers to corruption questions, but also by nonresponses and false responses to such questions.
Subfields: Economics and Econometrics, Sociology and Political Science, Statistics and Probability
View Paper: https://www.semanticscholar.org/paper/80474f16db7eac30b7a7448e26b44b59716beef1
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Citations in the corpus
- Institutional environment, innovation capacity and firm performance in Russia (2013, background): “Corruption undermines the overall quality of governance within a country and has wide-ranging negative effects on investment decisions, firm productivity, and national economic growth (Jensen et al., 2010).”
- Does bribery in the home country promote or dampen firm exports (2013, methodology): “Given the above cautions, although the BEEPS study was a survey in nature, it may not be severely affected either by the common method bias (Podsakoff et al., 2003) or by the response bias (Jensen, Li, and Rahman, 2010).”