Document Type
Article Restricted
Publication Date
11-2014
Journal Title
Journal of International Economics
Volume Number
94
Issue Number
2
First Page
277
Last Page
294
Abstract
This paper investigates how corruption affects firm behavior. Using an original and unusually rich dataset on bribe payments at ports matched to firm-level data, we observe how firms adapt to different types of corruption by adjusting their transport strategies. Our results suggest that firms respond to the price effects of corruption, organizing production in a way that increases or decreases demand for the public service.