, Volume 24, Issue 1, pp 97-114
Date: 12 Jan 2007

Corruption in Asia: Pervasiveness and arbitrariness

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How does one understand the differences and similarities of corruption among various Asian countries? We use a recent framework developed by Rodriguez, Uhlenbruck, and Eden (2005) to suggest that corruption has to be examined from two different dimensions: pervasiveness and arbitrariness. Using this framework, we ask why some Asian countries are able to achieve high levels of economic growth in the midst of high level corruption while other countries suffer from economic stagnation. We specifically suggest that more firms would bribe when pervasiveness is high, while fewer firms would bribe when arbitrariness is high. We also look into the implications on foreign direct investment.

We thank Mike Peng, Editor-in-Chief of the Asia Pacific Journal of Management, for his helpful comments. We also thank Yung Hua, Managing Editor, for editorial assistance. A portion of this work was presented at the 2006 Academy of International Business in Beijing and The University of Texas at Dallas. We appreciate the comments from David Deeds, Greg Dess, David Ford, Livia Markoczy, Mine Ozer, Jane Salk, and all conference and seminar participants.