Abstract

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.

The final version of this article can be found at the Journal of International Money and Finance.

Download PDF

Citation

Javorcik, Beata, and Shang-Jin Wei. "Corruption and Cross-Border Investment in Emerging Markets: Firm-Level Evidence." Journal of International Money and Finance 28 (2009): 605-624.

Each author name for a Columbia Business School faculty member is linked to a faculty research page, which lists additional publications by that faculty member.

Each topic is linked to an index of publications on that topic.