Corruption, Gender and Credit Constraints: Evidence from South Asian SMEs

  • Nirosha Hewa Wellalage
  • Stuart Locke
  • Helen Samujh
Original Paper


This paper provides analyses of the effect of corruption in South Asia on (1) credit access for small- and medium-size enterprises (SMEs), and (2) credit constraints faced by female-owned and male-owned SMEs. By addressing potential endogeneity and reverse causality of corruption and credit constraints via instrumental variables, this study reports that corruption has a detrimental effect on credit access. Specifically, corruption increases the probability of SMEs credit constraints by 7.63%. However, gender differences emerge, indicating that bribery is slightly more effective when used by female SME owners. When male-owned SMEs pay bribes, they are on average 0.61% more credit-constrained than their counterparts. For female-owned SMEs paying bribes, they are on average 0.78% more likely to be less credit-constrained compared to female SME owners who do not pay bribes. Overall, bribery is not very effective in achieving the desired outcome and attitudes towards bribery as unethical may be more a question of culture than of gender.


Gender Corruption Bribes SME Credit access South Asia 

JEL Classification

D73 E5 G21 L25 


Compliance with Ethical Standards

Conflict of interest

All three authors declare that they have no conflict of interest.

Ethical Approval

This article does not contain any studies with human participants performed by any of the authors.


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Copyright information

© Springer Science+Business Media B.V., part of Springer Nature 2018

Authors and Affiliations

  • Nirosha Hewa Wellalage
    • 1
  • Stuart Locke
    • 1
  • Helen Samujh
    • 1
  1. 1.School of Accounting, Finance and Economics, Waikato Management SchoolThe University of WaikatoHamiltonNew Zealand

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