What Determines the Return to Bribery? Evidence from Corruption Cases Worldwide

Yan-Leung Cheung, P. Raghavendra Rau, Aris Stouraitis

    Research output: Contribution to journalJournal articlepeer-review

    12 Citations (Scopus)


    We analyze a hand-collected sample of bribery cases from around the world to describe how the payment of bribes affects shareholder value. The net present value of a bribe conditional on getting caught is close to zero for the median firm in our sample. However, controlling for industry, country, and firm characteristics, a $1 increase in the size of the bribe is associated with an ex ante $6–$9 increase in the value of the firm, suggesting a correlation between the size of bribes and the size of available benefits. Proxies for information disclosure appear significant in explaining these benefits with more disclosure associated with lower benefits. However, this result is driven by democratic countries where bribe-paying firms receive smaller benefits relative to the bribes they pay. Information disclosure is not significant in autocratic countries.

    Original languageEnglish
    Pages (from-to)6235-6265
    Number of pages31
    JournalManagement Science
    Issue number10
    Early online date8 Dec 2020
    Publication statusPublished - Oct 2021

    Scopus Subject Areas

    • Strategy and Management
    • Management Science and Operations Research

    User-Defined Keywords

    • Bribes
    • Corruption
    • Country characteristics
    • Firm performance


    Dive into the research topics of 'What Determines the Return to Bribery? Evidence from Corruption Cases Worldwide'. Together they form a unique fingerprint.

    Cite this