Causes of Demand for International Bribery


Abstract
Corruption and bribery are not new to business. Bribes have been paid throughout recorded history. A large part of corruption includes bribe giving. Bribe giving, in the context of this paper, entails the payment giving or promising something of value to a government official to give favorable preference to the bribe giver. Although there has been some debate concerning whether or not bribery causes an economic drag on the economies of nations most evidence supports the contention that it is an economic drag. Bribery requires two parties the giver of the bribe, supply, and the receiver of the bribe, demand. Legislation and international agreements are designed to curb bribery are primarily directed at supply. The purpose of this paper is to identify, through a literature review, some of the demand determinates of bribery. From the literature four demand determinates have been identified; three are strong independent variables and one, political freedom, is less strong depending on its definition. The dimension of culture encompasses four components which were identified by Hofestede: Power distance, collectivism, masculinity, and uncertainty avoidance. The evidence indicates that to combat corruption and bribery all of the independent variables must be addressed. The most difficult variable to change is culture. A culture that supports bribery and corruption may continue to support bribery even if the economic and social variables are positively addressed. Since culture is imbedded and reinforced by a culture that variable may take a long time to change. The findings suggest that since culture plays a large part, as a demand determinate of bribery, in the reduction of bribe taking a generic approach to reducing bribery may not be effective. A regional approach to studying the demand determinates of bribery may be more effective in identifying localized demand determinates and the most effective means to combat bribery on a regional scale
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