Title: Corruption, income and business development

Authors: Monica Violeta Achim

Addresses: Finance Department, Faculty of Economics and Business Administration, Babeş-Bolyai University, Cluj-Napoca, Romania

Abstract: The main objective of this study was to investigate the influence of the level of corruption on business development. A large cross-countries survey of about 185 countries was used for the period 2012-2015. The empirical findings of this study show that corruption significantly reduced business development, being a major obstacle to economic growth. The influence of corruption on business development is highest when the index of doing business is used. This is significantly higher for developing countries as compared with developed countries. The findings emphasise the fact that corruption is a poverty-driven disease which significantly hinders business development. It was also found that that institutional quality plays a main role in reducing corruption thus enhancing the business development. This study may have significant implications for managers, investors, public bodies or business environment, by providing empirical evidences on the impact of corruption and institutional quality on business development.

Keywords: corruption; entrepreneurship; index of doing business; income; business development; cross-country survey; economic growth; poverty; institutional quality.

DOI: 10.1504/JIBED.2017.082757

Journal for International Business and Entrepreneurship Development, 2017 Vol.10 No.1, pp.85 - 100

Received: 24 Dec 2015
Accepted: 15 May 2016
Published online: 10 Mar 2017 *

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