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Economic uncertainty and corruption: evidence from public and private firms
Version 2 2023-06-12, 07:42
Version 1 2023-06-10, 02:40
journal contribution
posted on 2023-06-12, 07:42 authored by Mansoor Afzali, Gonal ColakGonal Colak, Mengchuan FuWe study the influence of policy uncertainty on the moral behavior of firms. When facing uncertainty, managers perceive various socioeconomic obstacles as more severe and disruptive to their business. Using data from policy uncertainty spouts in 93 countries, we document that some firms engage in norm-deviant behavior by cheating on taxes and paying more bribes. While private firms prefer to cheat on taxes, public firms choose bribery as a favorite tool to “grease the wheels” during periods of uncertainty. Strong social capital (local trust and religiosity) breaks this link between uncertainty and corruption.
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Publication status
- Published
File Version
- Published version
Journal
Journal of Financial StabilityISSN
1572-3089Publisher
ElsevierExternal DOI
Volume
57Page range
1-21Article number
a100936Department affiliated with
- Accounting and Finance Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2022-02-22First Open Access (FOA) Date
2022-02-22First Compliant Deposit (FCD) Date
2022-02-21Usage metrics
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