Revealing Corruption: Firm and Worker Level Evidence from Brazil

Serie

• NBER Working Papers

Resumen

• We study how the disclosure of corrupt practices affects the growth of firms involved in illegal interactions with the government using randomized audits of public procurement in Brazil. On average, firms exposed by the anti-corruption program grow larger after the audits, despite experiencing a decrease in procurement contracts. We manually collect new data on the details of thousands of corruption cases, through which we uncover a large heterogeneity in our firm-level effects depending on the degree of involvement in corruption cases. Using investment-, loan-, and worker- level data, we show that the average exposed firms adapt to the loss of government contracts by changing their investment strategy. They increase capital investment and borrow more to finance such investment, while there is no change in their internal organization. We provide qualitative support to our results by conducting new face-to-face surveys with business owners of government-dependent firms.

autores

• Colonnelli, Emanuele
• Lagaras, Spyridon
• Ponticelli, Jacopo
• Prem, Mounu
• Tsoutsoura, Margarita

fecha de publicación

• 2022

Área temática

• D73 - Burocracia; Procesos administrativos en organizaciones públicas; Corrupción
• G30 - Gobierno y financiación de la empresa: Generalidades
• H57 - Contratación pública
• O10 - Desarrollo económico, innovación, cambio tecnológico y crecimiento: Generalidades

Enfoque geográfico

• Brasil  Country
• South America  Continent

Issue

• 29627