Skip to main content
SpringerLink
Log in

Exploring Regional-Level Impact of Corruption and Crime on Multinational and Domestic Firms: The Evidence from Russia

  • Chapter
Book cover Impact of International Business

Part of the book series: The Academy of International Business ((AIB))

Abstract

It is now common knowledge that foreign direct investment (FDI) can be one of the key catalysts for technological development of a country. Indeed, to the extent it entails a transfer of technological, managerial and organisational skills, or provides access to other resources unavailable to certain economies, FDI can have a marked impact on the productivity spillovers, resulting in economic growth as technology transferred by multinationals enterprises (MNEs) stimulates domestic investment (Blomström et al., 20 01) and facilitates improvements in institutions (Smith and Thomas, 2015b). Since FDI constitutes a very large share of capital formation in transition countries (UNCTAD, 2015), the FDI-promoting effect of good institutions should be the key channel in the overall growth and development for these economies.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 84.99
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 109.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  • Acemoglu, Daron, Simon Johnson, and James A. Robinson (2002), ‘Reversal of Fortune: Geography and Institutions in Making of the Modern World Income Distribution’. Quarterly Journal of Economics, 118, 1231–1294.

    Article  Google Scholar 

  • Aidis, Ruta, Saul Estrin, and Tomasz Michiewicz (2008), ‘Institutions and Entrepre-neurship Development in Russia: A Comparative Perspective.’ Journal of Business Venturing, 23, 656–672.

    Article  Google Scholar 

  • Aidt, S. Toke (2003), ‘Economic Analysis of Corruption: A Survey.’ Economic Journal, 113(491), 632–652.

    Article  Google Scholar 

  • Anokhin, Sergey and William S. Schulze (2009), ‘Entrepreneurship, Innovation, and Corruption’. Journal of Business Venturing, 24(5), 465–476.

    Article  Google Scholar 

  • Arellano, Manuel and Stephen Bond (1991), ‘Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations’. Review of Economic Studies, 58, 277–297.

    Article  Google Scholar 

  • Arellano, Manuel and Olympia Bover (1995), ‘Another Look at the Instrumental Variable Estimation of Error Component Models’. Journal of Econometrics, 68, 29–51.

    Article  Google Scholar 

  • Baumol, William J. (1990), ‘Entrepreneurship: Productive, Unproductive, and Destructive.’ Journal of Political Economy, 98(5), 893–921.

    Article  Google Scholar 

  • Bevan, Alan and Saul Estrin (2004), ‘The Deter minants of Foreign Direct Invest ment into European Transition Economies’. Journal of Comparative Economics, 32(4), 775–787.

    Article  Google Scholar 

  • Blomström, Magnus, Ari Kokko, and Steven Globerman (2001), ‘The Determinants of Host Country Spillovers from Foreign Direct Investment: A Review and Synthesis of the Literature’, in Nigel Pain (ed.), Inward Investment, Technological Change and Growth: The Impact of Multinational Corporations on the UK Economy, Basingstoke: Palgrave, 34–65.

    Chapter  Google Scholar 

  • Blundell, Richard and Steve Bond (2000), ‘GMM Estimation with Persistent Panel Data: An Application to Production Functions’. Econometric Reviews, 19(3), 321–340.

    Article  Google Scholar 

  • Boycko, Maxim, Andrei Shleifer, and Robert W. Vishny (1996), ‘A Theory of Privatisation.’ Economic Journal, 106(435), 309–319.

    Article  Google Scholar 

  • Brock, Gregory J. (1998), ‘Foreign Direct Investment in Russia’s Regions 1993–95. Why So Little and Where Has It Gone?’ Economics of Transition, 6(2), 349–360.

    Article  Google Scholar 

  • Buchanan, Bonnie G., Quan V. Le, and Meenakshi Rishi (2012), ‘Foreign Direct Investment and Institutional Quality: Some Empirical Evidence’. International Review of Financial Analysis, 21, 81–89.

    Article  Google Scholar 

  • Busse, Matthias and Carsten Hefeker (2007), ‘Political Risk, Institutions and Foreign Direct Investment’. European Journal of Political Economy, 23(2), 397–415.

    Article  Google Scholar 

  • Dacin, Tina M., Gerry Goodstein, and Richard W. Scott (2002), ‘Institutional Theory and Institutional Change: Introduction to the Special Research Forum’. Academy of Management Journal, 45(1), 45–57.

    Article  Google Scholar 

  • Daniele, Vittorio and Ugo Marani (2010), ‘Organised Crime, the Quality of Local Institutions and FDI in Italy: A Panel Data Analysis’. European Journal of Political Economy, 27(1), 132–142.

    Article  Google Scholar 

  • Daude, Christian and Ernesto Stein (2007), ‘The Quality of Institutions and Foreign Direct Investment’. Economics and Politics, 19(3), 317–344.

    Article  Google Scholar 

  • Dawid, Herbert, Gustav Feichtinger, and Andreas Novak (2002), ‘Extortion as an Obstacle to Economic Growth: A Dynamic Game Analysis’. European Journal of Political Economy, 18, 499–516.

    Article  Google Scholar 

  • Dickson, Pat H. and Mark K. Weaver (2011), ‘Institutional Readiness and Small to Medium-Sized Enterprise Alliance Formation’. Journal of Small Business Management, 49(1), 126–148.

    Article  Google Scholar 

  • Djelic, Marie L. and Sigrid Quack (2003), ‘Governing Globalisation – Bringing Institutions Back In’, in Djelic L. Marie and Sigrid Quack (eds), Globalisation and Institutions: Redefining the Rules of the Economic Game , Cheltenham: Edward Elgar, 1–14.

    Chapter  Google Scholar 

  • Donohue, Joan J. (1998), ‘Understanding the Time Path of Crime’. The Journal of Criminal Law or Criminology, 88(4), 1423–1452.

    Article  Google Scholar 

  • Fajnzylber, Pablo, Daniel Lederman, and Norman Loayza (2000), ‘Crime and Victimisation: An Economic Perspective’. Economia, 1, 219–302.

    Google Scholar 

  • Feng, Yi (2001), ‘Political Freedom, Political Instability, and Policy Uncertainty: A Study of Political Institutions and Private Investment in Developing Countries.’ International Studies Quarterly, 45(2), 271–294.

    Article  Google Scholar 

  • Foreign Investment Advisory Council (2012), Russia’s Investment Climate 2012, available at: www.fiac.ru [accessed 25 January 2013].

    Google Scholar 

  • Fox, James A. and Marianne W. Zawitz (2000), Homicide Trends in the United States: 1998 Update , Washington, DC: US Department of Justice.

    Google Scholar 

  • Getz, Kathleen A. and Roger J. Volkema (2002), ‘Culture, Perceived Corruption, and Economics: A Model of Predictors and Outcomes’. Business and Society, 40(1), 7–30.

    Article  Google Scholar 

  • Ghoshal, Sumantra (1987), ‘Global Strategy: An Organising Framework’. Strategic Management Journal, 8(5), 425–440.

    Article  Google Scholar 

  • Ghura, Dhaneshwar and Barry Goodwin (2000), ‘Determinants of Private Investment: A Cross-Regional Empirical Investigation.’ Applied Economics, 32(14), 1819–1829.

    Article  Google Scholar 

  • Gohmann, Stephan F. (2012), ‘Institutions, Latent Entrepreneurship, and Self-Employment: An International Comparison’. Entrepreneurial Theory and Practice, 36(2), 295–321.

    Article  Google Scholar 

  • Gupta, Vishal K., Chun Guo, Mario Canever, Hyung R. Yim, Gaganjeet K. Sraw, and Ming Liu (2012), ‘Institutional Environment for Entrepreneurship in Rapidly Emerging Major Economies: The Case of Brazil, China, India, and Korea’. International Entrepreneurship Management Journal, 10(2), 376–384.

    Google Scholar 

  • Habib, Mohsin and Leon Zurawicki (2002), ‘Corruption and Foreign Direct Investment’. Journal of International Business Studies, 33(2), 291–307.

    Article  Google Scholar 

  • Henisz, Witold J. (2000), ‘The Institutional Environment for Multinational Investment’. Journal of Law, Economics and Organisation, 16(2), 334–364.

    Article  Google Scholar 

  • Hitt, Michael A., Duane R. Ireland, David G. Sirmon, and Cheryl A. Trahms (2011), ‘Strategic Entrepreneurship: Creating Value for Individuals, Organisations, and Society’. The Academy of Management Perspectives, 25(2), 57–76.

    Article  Google Scholar 

  • Hoffman, Andrew J. and Mark J. Ventresca (2002), Organisations, Policy and the Natural Environment . Stanford: Stanford University Press.

    Google Scholar 

  • Jain, Arvind K. (2001), ‘Corruption: A Review’. Journal of Economic Surveys, 15(1), 71–121.

    Article  Google Scholar 

  • Kinoshita, Yuko and Nauro Campos (2003), ‘Why Does FDI Go Where it Goes? New Evidence from the Transition Economies’. IMF Working Papers, 03 (228).

    Google Scholar 

  • Kostova, Tatiana, Kendall Roth, and Tina M. Dacin (2008), ‘Institutional Theory in the Study of Multinational Corporations: A Critique and New Directions’. Academy of Management Review, 33(4), 994–1006.

    Article  Google Scholar 

  • Lambsdorff, Johann G. (2003), ‘How Corruption Affects Productivity’. Kyklos, 56(4), 457–474.

    Article  Google Scholar 

  • Lederman, Daniel, Norman Loayza, and Ana María Menéndez (2002), ‘Violent Crime: Social Capital Matter?’ Economic Development and Cultural Change, 50(3), 509–539.

    Article  Google Scholar 

  • Leff, Nathaniel H. (1964), ‘Economic Development through Bureaucratic Corruption’. American Behavioural Scientist, 8(3), 8–14.

    Article  Google Scholar 

  • Li, Quan and Adam Resnick (2003), ‘Reversal of Fortunes: Democratic Institutions and Foreign Direct Investment Inf lows to Developing Countries’. International Organisation, 57(1), 175–211.

    Article  Google Scholar 

  • Lotspeich, Richard (1995), ‘Crime in the Transition Economies’. Europe–Asia Studies, 47(4), 555–589.

    Article  Google Scholar 

  • Mathur, Aparna and Katikeya Singh (2013), ‘Foreign Direct Investment, Corruption and Democracy’. Applied Economics, 45(8), 991–1002.

    Article  Google Scholar 

  • Meyer, Klaus E. (2001), ‘Institutions, Transaction Costs, and Entry Mode Choice in Eastern Europe’. Journal of International Business Studies, 32(2), 357–367.

    Article  Google Scholar 

  • Meyer, Klaus E. and Michael W. Peng (2005), ‘Probing Theoretically into Central and Eastern Europe: Transactions, Resources, and Institutions’. Journal of International Business Studies, 36, 600–621.

    Article  Google Scholar 

  • North, Douglass C. (1990), Institutional Change and Economic Performance . Cambridge: Cambridge University Press.

    Book  Google Scholar 

  • Oxley, Joanne E . (1999), ‘Institutional Environment and the Mechanisms of Governance: The Impact of Intellectual Property Protection on the Structure of Inter-Firm Alliances’. Journal of Economic Behaviour and Organisation, 38(3), 283–309.

    Article  Google Scholar 

  • Resmini, Laura (2000), ‘The Determinants of Foreign Direct Investment in the CEECs: New Evidence from Sectoral Patterns’. Economics of Transition, 8(3), 665–689.

    Article  Google Scholar 

  • Roodman, David M. (2009), ‘A Note on the Theme of Too Many Instruments’. Oxford Bulletin of Economics and Statistics, 71(1), 135–158.

    Article  Google Scholar 

  • Scott, Richard W. (2008), Institutions and Organisations: Ideas and Interests . Thousand Oaks, CA: Sage Publications.

    Google Scholar 

  • Shleifer, Andrei and Robert W. Vishny (1993), ‘Corruption’. The Quarterly Journal of Economics, 109(3), 599–617.

    Article  Google Scholar 

  • Smith, Natalya V. and Ekaterina Thomas (2014), ‘Innovation in Emerging Economies: The Spillover Effects of Foreign Direct Investment and Institutions in Russia’, in Svetla Marinova (ed.), Institutional Impacts on Firm Internalisation, London: Palgrave McMillan, 146–172.

    Google Scholar 

  • Smith, Natalya V., Ekaterina Thomas and Christos Antoniou (2014), ‘Multi-National Firms, Corruption and Innovation in Russia’, in Alan Verbeke, Rob Van Tulder, and Sarianna Lundan (eds), Multinational Enterprises, Markets and Institutional Diversity, Bingley, UK: Emerald Group Publishing Limited, 9, 347–371.

    Google Scholar 

  • Smith, Natalya V., Ekaterina Thomas and Christos Antoniou (2015a), ‘Determinants of Russia’s Informal Economy: The Impact of Corruption and Multinational Firms’. Journal of East–West Business, 21(2), 102–128.

    Google Scholar 

  • Smith, Natalya V., Ekaterina Thomas and Christos Antoniou (2015b), ‘The Role of FDI and State Capture in Shaping Innovation Outcome in Russia’. Europe–Asia Studies, 67 (5), 777–808.

    Article  Google Scholar 

  • Stenholm, Pekka, Zoltan J. Acs, and Robert Wuebker (2013), ‘Exploring Country-Level Institutional Arrangements on the Rate and Type of the Entrepreneurial Activity’. Journal of Business Venturing, 28 (1), 176–193.

    Article  Google Scholar 

  • Tanzi, Vito and Hamid R. Davoodi (2000), ‘Corruption, Growth, and Public Finances’. IMF Working Papers, 1–27.

    Google Scholar 

  • United Nations Conference on Trade and Development (UNCTAD) (2015), United Nations Statistical Databases, United Nations Statistics Division, available at: http://unstats.un.org/unsd/databases.htm, [accessed 25 June 2015].

    Google Scholar 

  • Voyer, Peter A. and Paul W. Beamish (2004), ‘The Effect of Corruption on Japanese Foreign Direct Investment’. Journal of Business Ethics, 50 (3), 211–224.

    Article  Google Scholar 

  • Windmeijer, Frank (2005), ‘A Finite Sample Correction for the Variance of Linear Eff icient Two-Step GMM Estimators’. Journal of Econometrics, 126 (1), 25–51.

    Article  Google Scholar 

  • World Bank (2003), World Development Indicators 2003. Sustainable Development in a Dynamic World . Washington: The World Bank.

    Google Scholar 

  • World Bank Group (2010), Doing Business: Measuring Business Regulations, available at: http://www.doingbusiness.org/, [accessed 24 June 2015].

    Google Scholar 

Download references

Authors
  1. Natalya Victor Smith
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. Manchester Metropolitan University Business School, UK

    Heinz Tüselmann , Stephen Buzdugan , Qi Cao , David Freund  & Sougand Golesorkhi , , ,  & 

Copyright information

© 2016 Natalya Victor Smith

About this chapter

Cite this chapter

Smith, N.V. (2016). Exploring Regional-Level Impact of Corruption and Crime on Multinational and Domestic Firms: The Evidence from Russia. In: Tüselmann, H., Buzdugan, S., Cao, Q., Freund, D., Golesorkhi, S. (eds) Impact of International Business. The Academy of International Business. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-137-56946-2_3

Download citation

Publish with us

Policies and ethics

Search

Navigation