Last corrupt deed before retirement? Evidence from a lower middle-income country

Cuong Nguyen

Journal of Development Economics, 2021, vol. 151, issue C

Abstract: We provide evidence of the effect of term limits on the rent-seeking behavior of directors of state-owned enterprises (SOEs) in Vietnam by showing that these directors recruit substantially more employees just before retirement. We argue that a possible motive of these directors for the over-recruitment is to obtain bribes from employees, since the increase in employment is not associated with higher output, and the effect of these directors’ last year in office on SOE labor is smaller in provinces with better corruption control. This finding also provides an explanation why SOEs tend to have an excess of labor and suggests that privatization can reduce this excess.

Keywords: Term limits; Retirement; Corruption; State-owned enterprise; Privatization (search for similar items in EconPapers)
JEL-codes: D72 J23 L32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:151:y:2021:i:c:s0304387821000523

DOI: 10.1016/j.jdeveco.2021.102673

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