Corruption and cross-border investment in emerging markets: Firm-level evidence

This paper studies the joint impact of corruption on the entry mode and volume of inward foreign direct investment (FDI) using a unique firm-level data set. We find that corruption not only reduces inward FDI, but also shifts the ownership structure towards joint ventures. The latter finding supports the view that corruption increases the value of using a local partner to cut through the bureaucratic maze. However, R&D intensive firms are found to favor sole ownership.

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Year of publication:	2009
Authors:	Javorcik, Beata S. ; Wei, Shang-Jin
Published in:	Journal of International Money and Finance. - Elsevier, ISSN 0261-5606. - Vol. 28.2009, 4, p. 605-624
Publisher:	Elsevier
Keywords:	Corruption Developing countries Foreign direct investment Multinational firms Joint ventures

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Type of publication:	Article
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005066649