Why do Firms Hide? Bribes and Unofficial Activity After Communism

Simon Johnson, John McMillan and Christopher Woodruff

No 2105, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Our survey of private manufacturing firms finds the size of hidden "unofficial" activity to be much larger in Russia and Ukraine than in Poland, Slovakia and Romania. A comparison of cross-country averages shows that managers in Russia and Ukraine face higher effective tax rates, worse official corruption, greater incidence of mafia protection, and have less faith in the court system. Our firm-level regressions for the three Eastern European countries find that official corruption is significantly associated with hiding output.

Keywords: Corruption; unofficial economy (search for similar items in EconPapers)
JEL-codes: H26 O17 P35 (search for similar items in EconPapers)
Date: 1999-03
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Citations: View citations in EconPapers (16)

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Related works:
Chapter: Why Do Firms Hide? Bribes and Unofficial Activity after Communism (2007)
Working Paper: Why Do Firms Hide? Bribes and Unofficial Activity after Communism (2003)
Journal Article: Why do firms hide? Bribes and unofficial activity after communism (2000)
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