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Offshoring of Services and Corruption: Do Firms Escape Corrupt Countries?

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  • Karpaty, Patrik

    (Department of Business, Economics, Statistics and Informatics)

  • Gustavsson Tingvall, Patrik

    (Stockholm School of Economics and Centre of Excellence for Science and Innovation Studies (CESIS))

Abstract

In this paper, we analyze how the offshoring of services by Swedish firms is affected by corruption in target economies. The results suggest that firms avoid corrupt countries and that corruption reduces the amount of offshored services. In addition, the sensitivity to corruption is highest for poor countries, and large and internationalized firms are the ones that tend to be the most sensitive to corruption.

Suggested Citation

  • Karpaty, Patrik & Gustavsson Tingvall, Patrik, 2011. "Offshoring of Services and Corruption: Do Firms Escape Corrupt Countries?," Working Papers 2011:2, Örebro University, School of Business, revised 28 May 2012.
    • Handle: RePEc:hhs:oruesi:2011_002
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    More about this item

    Keywords

    Corruption; Services; Offshoring; Gravity model; Firm level data;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures

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