How petty is petty corruption? Evidence from firm survey in Africa
AbstractRecent firm-level surveys suggest that petty corruption is a serious problem for African firms, costing the average firm in many countries between 2.5 and 4.5 percent of sales. However, a minor difference in the way firms answer the question has a large effect on estimates of the size of the burden. On average, firms report payments that are between four and fifteen times higher when they report them as a percent of sales than when they report them in monetary terms. This paper discusses several possible reasons why there might be a difference including outliers, differences between firms that report bribes in monetary terms and firms that report them as a percent of sales, and the sensitivity of the corruption question. But none of these explanations explain the discrepancy. One plausible remaining reason is that firm managers overestimate bribes when they report them in percentage terms. If this is the case, petty corruption might be far less costly than the raw data suggest.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 15073.
Date of creation: 24 Apr 2008
Date of revision: 24 Aug 2008
Corruption; Africa; Firm Surveys;
Other versions of this item:
- Clarke, George R.G., 2011. "How Petty is Petty Corruption? Evidence from Firm Surveys in Africa," World Development, Elsevier, vol. 39(7), pages 1122-1132, July.
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
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