Foreign Ownership of Firms and Corruption in Africa
The study finds the impact of the percentage of total annual sales of a firm paid as informal payments to public officials (bribes) on foreign ownership of firms in Africa while controlling for other variables outside the country of origin of investment. The study used secondary data from the Worl...
Main Author: | |
---|---|
Format: | Article |
Language: | English |
Published: |
EconJournals
2015-07-01
|
Series: | International Journal of Economics and Financial Issues |
Online Access: | https://econjournals.com/index.php/ijefi/article/view/1248 |
_version_ | 1797918201079660544 |
---|---|
author | Anselm Komla Abotsi |
author_facet | Anselm Komla Abotsi |
author_sort | Anselm Komla Abotsi |
collection | DOAJ |
description |
The study finds the impact of the percentage of total annual sales of a firm paid as informal payments to public officials (bribes) on foreign ownership of firms in Africa while controlling for other variables outside the country of origin of investment. The study used secondary data from the World Business Environment Survey (WBES) conducted by the World Bank. In all 3,290 firms made up of the manufacturing, services and retail sectors are included in the analysis. The Tobit and probit estimation techniques were used. The results indicate that the percentage of total annual sales of the firm paid as informal payments to the public officials has a negative and highly significant impact on foreign ownership of firms in Africa. African leaders should therefore institute policies to control corruption in order to boost foreign investors' confidence in their economies.
Keywords: foreign ownership of firm; informal payments; corruption; institutions; foreign investors
JEL Classifications: F21; F23; F32
|
first_indexed | 2024-04-10T13:25:34Z |
format | Article |
id | doaj.art-3a98dbae5bcc49dca818602d6756fac6 |
institution | Directory Open Access Journal |
issn | 2146-4138 |
language | English |
last_indexed | 2024-04-10T13:25:34Z |
publishDate | 2015-07-01 |
publisher | EconJournals |
record_format | Article |
series | International Journal of Economics and Financial Issues |
spelling | doaj.art-3a98dbae5bcc49dca818602d6756fac62023-02-15T16:11:52ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382015-07-0153Foreign Ownership of Firms and Corruption in AfricaAnselm Komla Abotsi01. School of Development Economics, National Institute of Development Administration, Thailand 2. Department of Economics, University of Education, Winneba The study finds the impact of the percentage of total annual sales of a firm paid as informal payments to public officials (bribes) on foreign ownership of firms in Africa while controlling for other variables outside the country of origin of investment. The study used secondary data from the World Business Environment Survey (WBES) conducted by the World Bank. In all 3,290 firms made up of the manufacturing, services and retail sectors are included in the analysis. The Tobit and probit estimation techniques were used. The results indicate that the percentage of total annual sales of the firm paid as informal payments to the public officials has a negative and highly significant impact on foreign ownership of firms in Africa. African leaders should therefore institute policies to control corruption in order to boost foreign investors' confidence in their economies. Keywords: foreign ownership of firm; informal payments; corruption; institutions; foreign investors JEL Classifications: F21; F23; F32 https://econjournals.com/index.php/ijefi/article/view/1248 |
spellingShingle | Anselm Komla Abotsi Foreign Ownership of Firms and Corruption in Africa International Journal of Economics and Financial Issues |
title | Foreign Ownership of Firms and Corruption in Africa |
title_full | Foreign Ownership of Firms and Corruption in Africa |
title_fullStr | Foreign Ownership of Firms and Corruption in Africa |
title_full_unstemmed | Foreign Ownership of Firms and Corruption in Africa |
title_short | Foreign Ownership of Firms and Corruption in Africa |
title_sort | foreign ownership of firms and corruption in africa |
url | https://econjournals.com/index.php/ijefi/article/view/1248 |
work_keys_str_mv | AT anselmkomlaabotsi foreignownershipoffirmsandcorruptioninafrica |