This paper considers the effect of corruption on the effciency of capital investment. Using firm-level level data from … informal bribe payments distorts the efficient allocation of capital by reducing the marginal return per unit investment. Using …

This paper uses a unique panel dataset on firm-level corruption. It contains quantitative information on bribe payments … by a sample of formal and informal Vietnamese firms. We show that bribe incidence is highly associated with firm … outweighs the additional bribe cost of formalization. Formalization embodies net benefits in spite of the growth hampering …