Threat of Falling High Status and Corporate Bribery: Evidence from the Revealed Accounting Records of Two South Korean Presidents

Strategic Management Journal, Forthcoming

Ross School of Business Paper

42 Pages Posted: 5 Jan 2018

See all articles by Yujin Jeong

Yujin Jeong

American University

Jordan I. Siegel

University of Michigan

Date Written: November 1, 2017

Abstract

Social status and its dynamics may be an important predictor of which firms will engage in large-scale bribery. Prior theory is incomplete, however, and prior studies have lacked comprehensive and reliable data on firm-level bribery decisions. We offer a new theoretical prediction and a novel data set on high-level corruption in South Korea, where the accounting records of two presidents in the 1987-1992 era were exposed to after-the-fact legal and public scrutiny. We find that, controlling for a range of alternative explanations, the threat of falling high status—that is, the combination of longstanding high social status with current-period mediocre economic performance relative to that of industry peers—is a statistically and economically meaningful predictor of increases in the amount of large-scale corporate bribery.

Keywords: Status; Bribery; Corruption; Political network; Nonmarket strategy

JEL Classification: M1, M10, M14, M16, K42

Suggested Citation

Jeong, Yujin and Siegel, Jordan I., Threat of Falling High Status and Corporate Bribery: Evidence from the Revealed Accounting Records of Two South Korean Presidents (November 1, 2017). Strategic Management Journal, Forthcoming; Ross School of Business Paper. Available at SSRN: https://ssrn.com/abstract=3095764

Yujin Jeong

American University ( email )

Kogod School of Business
4400 Massachusetts Avenue NW
Washington, DC 20016
United States
202-885-1887 (Phone)

HOME PAGE: http://yujinjeong.creatorlink.net/

Jordan I. Siegel (Contact Author)

University of Michigan ( email )

Ann Arbor, MI
United States

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