Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries
This paper empirically examines the demand and supply sides of bribery using World Bank Enterprise Survey data on 18,005 firms in 75 developing countries. It assesses the determinants of firms' bribe paying behavior and examine how bribe behav...
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/615631603117229194/Why-Do-Firms-Pay-Bribes-Evidence-on-the-Demand-and-Supply-Sides-of-Corruption-in-Developing-Countries http://hdl.handle.net/10986/34649 |
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okr-10986-346492022-09-20T00:09:32Z Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries Gauthier, Bernard Goyette, Jonathan Kouame, Wilfried CORRUPTION BRIBERY BUSINESS ENVIRONMENT GOVERNANCE PROCUREMENT TAX EVASION ENTERPRISE SURVEY This paper empirically examines the demand and supply sides of bribery using World Bank Enterprise Survey data on 18,005 firms in 75 developing countries. It assesses the determinants of firms' bribe paying behavior and examine how bribe behavior affects two main sectors where corruption is rampant: taxation and government contracts. The paper shows that corruption in tax administration tends to be mainly a demand-side phenomenon. Paying a bribe requested by a public official is associated with a 16 percent increase in the share firms~^!!^ sales not reported for tax purposes. In public procurement, the results suggest, on the contrary, that corruption is a supply-side phenomenon, with bribe transactions generally initiated by firms to secure public contracts. Firms supplying a bribe without a previous request by officials is associated with a 17 percent increase in the bribe paid to secure a government contract, more than three times the effect observed on the demand side of bribery. 2020-10-22T16:26:13Z 2020-10-22T16:26:13Z 2020-10 Working Paper http://documents.worldbank.org/curated/en/615631603117229194/Why-Do-Firms-Pay-Bribes-Evidence-on-the-Demand-and-Supply-Sides-of-Corruption-in-Developing-Countries http://hdl.handle.net/10986/34649 English Policy Research Working Paper;No. 9441 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper |
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Digital Repository |
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Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
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World Bank |
| language |
English |
| topic |
CORRUPTION BRIBERY BUSINESS ENVIRONMENT GOVERNANCE PROCUREMENT TAX EVASION ENTERPRISE SURVEY |
| spellingShingle |
CORRUPTION BRIBERY BUSINESS ENVIRONMENT GOVERNANCE PROCUREMENT TAX EVASION ENTERPRISE SURVEY Gauthier, Bernard Goyette, Jonathan Kouame, Wilfried Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| relation |
Policy Research Working Paper;No. 9441 |
| description |
This paper empirically examines the
demand and supply sides of bribery using World Bank
Enterprise Survey data on 18,005 firms in 75 developing
countries. It assesses the determinants of firms' bribe
paying behavior and examine how bribe behavior affects two
main sectors where corruption is rampant: taxation and
government contracts. The paper shows that corruption in tax
administration tends to be mainly a demand-side phenomenon.
Paying a bribe requested by a public official is associated
with a 16 percent increase in the share firms~^!!^ sales not
reported for tax purposes. In public procurement, the
results suggest, on the contrary, that corruption is a
supply-side phenomenon, with bribe transactions generally
initiated by firms to secure public contracts. Firms
supplying a bribe without a previous request by officials is
associated with a 17 percent increase in the bribe paid to
secure a government contract, more than three times the
effect observed on the demand side of bribery. |
| format |
Working Paper |
| author |
Gauthier, Bernard Goyette, Jonathan Kouame, Wilfried |
| author_facet |
Gauthier, Bernard Goyette, Jonathan Kouame, Wilfried |
| author_sort |
Gauthier, Bernard |
| title |
Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| title_short |
Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| title_full |
Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| title_fullStr |
Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| title_full_unstemmed |
Why Do Firms Pay Bribes? Evidence on the Demand and Supply Sides of Corruption in Developing Countries |
| title_sort |
why do firms pay bribes? evidence on the demand and supply sides of corruption in developing countries |
| publisher |
World Bank, Washington, DC |
| publishDate |
2020 |
| url |
http://documents.worldbank.org/curated/en/615631603117229194/Why-Do-Firms-Pay-Bribes-Evidence-on-the-Demand-and-Supply-Sides-of-Corruption-in-Developing-Countries http://hdl.handle.net/10986/34649 |
| _version_ |
1764481352573386752 |