Who Benefits from Anti-Corruption Enforcement?

46 Pages Posted: 29 Jan 2021 Last revised: 16 Apr 2021

See all articles by Jim Goldman

Jim Goldman

University of Toronto

Stefan Zeume

University of Illinois at Urbana-Champaign

Date Written: December 9, 2020


We exploit enforcement actions for violations of the U.S. Foreign Corrupt Practices Act in non-OECD countries to study the effect of anti-bribery enforcement on unpunished firms. Firms in the same country-industry as the violator experience significant increases in revenue (+6.4%) and asset productivity (+4.2%). This result is driven by foreign-owned business group affiliates and amplified when affiliates are active in government-dependent industries, members of groups with limited corruption experience, and owned by productive parents. Overall, anti-bribery enforcement actions, which also reduce local corruption levels, result in reallocation of economic activity and level a playing field disrupted by corruption.

Keywords: business groups, competition, corruption, firm growth, Foreign Corrupt Practices Act

JEL Classification: G30, G38, K22

Suggested Citation

Goldman, Jim and Zeume, Stefan, Who Benefits from Anti-Corruption Enforcement? (December 9, 2020). Available at SSRN: https://ssrn.com/abstract=3745751 or http://dx.doi.org/10.2139/ssrn.3745751

Jim Goldman (Contact Author)

University of Toronto ( email )

Department of Economics
Toronto, Ontario M5S 3G7

Stefan Zeume

University of Illinois at Urbana-Champaign ( email )

1206 South Sixth Street
Champaign, IL 61820
United States

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