Regulation and corporate corruption: New evidence from the telecom sector

Sanford Berg, Liangliang Jiang and Chen Lin

Journal of Comparative Economics, 2012, vol. 40, issue 1, 22-43

Abstract: This paper examines how government regulation in developing countries affects the form of corruption between business customers and service providers in the telecom sector. We match the World Bank enterprise-level data on bribes with a unique cross-country telecom regulation dataset collected by Wallsten et al. (2004), finding that (1) strong regulatory substance (the content of regulation) and regulatory governance reduce corruption; (2) competition and privatization reduces corruption; (3) the effects of regulatory substance on corruption control are stronger in countries with state-owned or partially state-owned telecoms, greater competition, and higher telecommunication fees; and (4) bureaucratic quality exert substitution effects to regulatory substance in deterring corruption. Overall, our results suggest that regulatory strategies that reduce information asymmetry and increase accountability tend to reduce illegal side-payments for connections.

Keywords: Telecommunications; Regulation; Corruption (search for similar items in EconPapers)
JEL-codes: K4 L5 L9 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Working Paper: Regulation and corporate corruption: new evidence from the telecom sector (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:40:y:2012:i:1:p:22-43

DOI: 10.1016/j.jce.2011.12.001

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