 |
 |
 |
 |
 |
 |
 |
research institution devoted to the study of international economic policy. More › ›
subscribe
Keep up to date with Peterson Institute publications, events, and interviews via email, podcast, or RSS. More information on subscription options.
- Peterson Institute Update Newsletter (email)
- Peterson Institute Update Newsletter (RSS)
- Peterson Institute Update
- RealTime Economic Issues Watch
- Event Podcast
- Peterson Perspectives: Interviews on Current Issues
Follow us
 |
 |
 |
Use filters to narrow your search through our publications and events.
translate
Working Paper 11-20
Rent(s) Asunder: Sectoral Rent Extraction Possibilities and Bribery by Multinational Corporations
by Edmund Malesky, University of California, San Diego
and Nathan Jensen, Washington University
and Dimitar Gueorguiev, University of California, San Diego
December 2011
Openness to foreign investment can have differential effects on corruption, even within the same country and under the exact same domestic institutions over time. This theoretical approach departs from standard political economy by attributing corruption motives to firms as well as officials. Rather than interpreting bribes solely as a coercive "tax" imposed on business activities, it allows for the possibility that firms may be complicit in using bribes to enter protected sectors. Variation in bribe propensity across sectors is anticipated according to expected profitability which is proxied with investment restrictions. Specifically, it is expected that foreign investment will not be associated with corruption in sectors with fewer restrictions and more competition, but will increase dramatically as firms seek to enter restricted and uncompetitive sectors that offer higher rents. This effect is tested using a list experiment, a technique drawn from applied psychology, embedded in a nationally representative survey of 10,000 foreign and domestic businesses in Vietnam. Findings show that the impact of domestic reforms and economic openness on corruption is conditional on polices that restrict competition by limiting entry into the sector.
View full document [pdf]
RELATED LINKS
Policy Brief 13-1: The World Needs a Multilateral Investment Agreement January 2013
Working Paper 12-16: Transactions: A New Look at Services Sector Foreign Direct Investment in Asia October 2012
Working Paper 08-7: Policy Liberalization and FDI Growth, 1982 to 2006 August 2008
Book: US National Security and Foreign Direct Investment May 2006
Op-ed: Avoiding Another Dubai February 28, 2006
Book: Does Foreign Direct Investment Promote Development? May 2005