Crime, Law and Social Change

, Volume 65, Issue 4–5, pp 377–394 | Cite as

The impact of petty corruption on firm innovation in Vietnam

  • Ngoc Anh Nguyen
  • Quang Hung Doan
  • Ngoc Minh Nguyen
  • Binh Tran-Nam


Corruption has been found to have complex effects on firm innovation. Limited theoretical and empirical evidence to date has been rather inconclusive. This study employs econometric estimation techniques to analyze data from small and medium manufacturing enterprises in Vietnam to assess the impact of petty corruption on firm innovation. The empirical results tend to support the “greasing” impact of corruption on innovation. Specifically, informal payments by Vietnamese firms are shown to encourage overall innovation, product improvement, innovation and new innovation. In view of the commonplace business practice of paying small informal fees to speed up transactions in the inefficient public sector in Vietnam, this finding is not entirely unexpected, though troubling.


Process Innovation Product Innovation Foreign Firm Informal Payment Firm Innovation 



The authors would like to thank Lien Nguyen, Edmund Malesky, the conference and symposium organizers and participants, and the guest editors of this special issue for their valuable comments.

Compliance with Ethical Standards

Financial support

Financial support from the Department for International Development (DFID) Vietnam is also gratefully acknowledged. The views expressed in this article are those of the authors and do not necessarily reflect those of DFID Vietnam or DEPOCEN.


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Copyright information

© Springer Science+Business Media Dordrecht 2016

Authors and Affiliations

  • Ngoc Anh Nguyen
    • 1
    • 2
  • Quang Hung Doan
    • 1
    • 3
  • Ngoc Minh Nguyen
    • 1
  • Binh Tran-Nam
    • 4
    • 5
  1. 1.Development and Policies Research Center (DEPOCEN)HanoiVietnam
  2. 2.IPAG Business SchoolParisFrance
  3. 3.Foreign Trade UnivesityHanoiVietnam
  4. 4.RMIT International UniversityHo Chi Minh CityVietnam
  5. 5.University of New South Wales AustraliaSydneyAustralia

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