Dynamic Effects of Corruption on Offshoring
AbstractAbstract: For international outsourcing to occur, agents from different jurisdictions must agree on a contract. Using Swedish firm-level data, we analyze offshoring and how a firm’s choice of target country and the dynamics of offshored volumes are affected by corruption. The results suggest that corruption is a deterrent to offshoring and that internationalized firms trading with many countries use their flexibility to avoid corrupt countries. Furthermore, firms that are able to establish long-term contracts do so by starting small and successively deepening their engagements.
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Bibliographic InfoPaper provided by The Ratio Institute in its series Ratio Working Papers with number 182.
Length: 32 pages
Date of creation: 20 Dec 2011
Date of revision:
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Postal: The Ratio Institute, P.O. Box 5095, SE-102 42 Stockholm, Sweden
Phone: 08-441 59 00
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Web page: http://www.ratio.se/
More information through EDIRC
corruption; offshoring; gravity; firm-level data;
Find related papers by JEL classification:
- D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
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