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FDI, Institutional Quality, and Bribery: An Empirical Examination in China

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  • Kum-Sik Oh

    (Division of Undeclared and Exploratory Majors, Pukyong National University, Busan 48513, Korea)

  • Yeon-Sik Ryu

    (School of Business Management, Hongik University, Sejong 30016, Korea)

Abstract

This study attempts to identify the key factors inhibiting the bribery practices of multinational enterprise (MNE) subsidiaries directed at local managers in China. During the experiment, this study employs an institutional theory, identifies primary determinants on the phenomenon, and compares the main components between old versus young subsidiaries. Data were collected through a questionnaire survey and both regression and spearman rank order correlation analyses were used as statistical techniques. Through the analyses, we found that a cognitive pillar is a crucial element contributing to the inhibition of bribery practices, the enhancement of institutional quality, and the promotion of sustainable development in the emerging economy. We expect that the results will provide useful implications for MNE managers planning to invest in China and for policy makers enacting institutional environments.

Suggested Citation

  • Kum-Sik Oh & Yeon-Sik Ryu, 2019. "FDI, Institutional Quality, and Bribery: An Empirical Examination in China," Sustainability, MDPI, vol. 11(15), pages 1-11, July.
    • Handle: RePEc:gam:jsusta:v:11:y:2019:i:15:p:4023-:d:251515
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    References listed on IDEAS

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    Cited by:

    1. Muhammad Asif Khan & Hossam Haddad & Mahmoud Odeh & Ahsanuddin Haider & Mohammed Arshad Khan, 2022. "Institutions, Culture, or Interaction: What Determines the Financial Market Development in Emerging Markets?," Sustainability, MDPI, vol. 14(23), pages 1-23, November.
    2. Alfredo Jimenez & Jeoung Yul Lee & Xavier Ordeñana, 2021. "Introduction: FDI and Institutional Quality: New Insights and Future Perspectives from Emerging and Advanced Economies," Sustainability, MDPI, vol. 13(8), pages 1-4, April.
    3. Chong Wu & Siyi Bo & Xing Wan & Min Ji & Meihua Chen & Shifan Zhang, 2020. "Does the Choice of IJV under Institutional Duality Promote the Innovation Performance of Chinese Manufacturing Firms? Evidence from Listed Chinese Manufacturing Companies," Sustainability, MDPI, vol. 12(17), pages 1-21, August.
    4. Chunyang Pan & William X. Wei & Etayankara Muralidharan & Jia Liao & Bernadette Andreosso-O’Callaghan, 2020. "Does China’s Outward Direct Investment Improve the Institutional Quality of the Belt and Road Countries?," Sustainability, MDPI, vol. 12(1), pages 1-21, January.
    5. Seunghyun Kim & Byungchul Choi, 2020. "The Impact of the Technological Capability of a Host Country on Inward FDI in OECD Countries: The Moderating Roles of Institutional Quality," Sustainability, MDPI, vol. 12(22), pages 1-18, November.

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