Does Corruption Impact on Firms' Ability to Conduct Business in Mauritania? Evidence from Investment Climate Survey Data

32 Pages Posted: 20 Apr 2016

See all articles by Manuela Francisco

Manuela Francisco

University of Nottingham - School of Economics

Nicola Pontara

World Bank

Date Written: December 1, 2007

Abstract

This paper seeks to understand whether Mauritanian firms deem corruption as an obstacle to operate and grow, to identify the profile of firms that are more likely to make informal payments, and to quantify the size of these payments. The results of the analysis show that perceptions of corruption can be potentially misleading. Corruption is not considered to be one of the most taxing factors impeding the growth of firms in Mauritania. Yet, its cost to firms is significant and greater than in the comparator group countries. This means that corruption is internalized by firms and considered an accepted practice. Alternatively, firms may fear reporting corruption practices for fear of retaliation. Econometric evidence on the propensity and intensity of bribes suggests that medium-size firms suffer the most from corruption in Mauritania. Larger firms are more established and connected, do not fear exiting the market, and are less likely to be harassed. Smaller firms are less visible and may be able to escape the control of public officials by operating largely in the informal sector. Medium-size firms are the most likely to pay bribes and to pay the highest amounts as a percentage of their total annual sales, which places a heavy burden on their ability to grow.

Keywords: Public Sector Corruption & Anticorruption Measures, Access to Finance, Governance Indicators, Microfinance, National Governance

Suggested Citation

Francisco, Manuela and Pontara, Nicola, Does Corruption Impact on Firms' Ability to Conduct Business in Mauritania? Evidence from Investment Climate Survey Data (December 1, 2007). World Bank Policy Research Working Paper Series, Vol. , pp. -, 2007. Available at SSRN: https://ssrn.com/abstract=1073382

Manuela Francisco

University of Nottingham - School of Economics ( email )

University Park
Nottingham, NG7 2RD
United Kingdom
115 951 5870 (Phone)
115 951 4159 (Fax)

Nicola Pontara (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
132
Abstract Views
767
rank
225,238
PlumX Metrics