To bribe or not to bribe? Corruption uncertainty and corporate practices

0478449 - NHÚ 2019 RIV GB eng V - Výzkumná zpráva
Hanousek, Jan - Shamshur, Anastasiya - Trešl, Jiří
To bribe or not to bribe? Corruption uncertainty and corporate practices.
London: Centre for Economic Policy Research, 2017. 54 s. CEPR discussion paper series, 12094. ISSN 0265-8003
Grant CEP: GA ČR(CZ) GA16-20451S
Institucionální podpora: RVO:67985998
Klíčová slova: corporate investment * corruption * uncertainty
Obor OECD: Finance
http://cepr.org/active/publications/discussion_papers/dp.php?dpno=12094#

Using a large sample of private firms over the period from 2001 to 2013, we study the effect of corruption uncertainty on corporate investments and cash holdings. We find that a higher uncertainty about the level of corruption is associated with lower corporate investments and lower cash holdings. These results are sensitive to the ownership structure of a firm. Firms with no foreign majority ownership appear to be more sensitive to corruption-induced uncertainty than majority-controlled foreign firms. They significantly decrease their investments and cash holdings. We hypothesize that they move their cash off-balance-sheet to create cash reserves as the uncertainty of when, whom, and how much to bribe increases.
Trvalý link: http://hdl.handle.net/11104/0274566