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Anti-corruption courts and foreign direct investments

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  • Kuvvet, Emre

Abstract

We look at the association between anti-corruption courts and foreign direct investments. We find the position of anti-corruption courts in the judicial hierarchy influences the relationship between anti-corruption courts and foreign direct investments. While First Instance Court and Hybrid Court systems are negatively associated with foreign direct investments, a Comprehensive Parallel Court system is positively associated. Additional evidence from bilateral foreign direct investments suggests that investor countries with high corruption are associated with an increase in their direct investments to countries that establish First Instance Court and Hybrid Court. However, those corrupt investor countries are associated with a decrease in direct investments if a country, instead, creates a Comprehensive Parallel Court.

Suggested Citation

  • Kuvvet, Emre, 2021. "Anti-corruption courts and foreign direct investments," International Review of Economics & Finance, Elsevier, vol. 72(C), pages 573-582.
    • Handle: RePEc:eee:reveco:v:72:y:2021:i:c:p:573-582
    DOI: 10.1016/j.iref.2020.12.019
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    References listed on IDEAS

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    More about this item

    Keywords

    Anti-corruption court; Foreign direct investment; Corruption; Bribery;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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