Corruption has been a major obstacle to economic growth around the world. In this paper, we examine how firms interact with corrupt government officials either to minimize the impact of corruption on their operations or to maximize their benefit of paying a bribe. Our estimates show that firms know exactly what they need and use their limited resources to bribe only relevant government authorities. In other words, firms are rational bribers who know exactly what they need and optimize their bribes (...) to fulfill that need. This type of intentional bribery could be reduced by enhanced institutional environments and improved openness of the economy. (shrink)

Using a conviction-based measure, we find that local public corruption exerts a negative effect on the lending activity of US banks. Our baseline estimations show that the difference in public corruption between, for example, Alabama, where corruption is high, and Minnesota, where corruption is low, implies that banks headquartered in the former state grant 0.55% less credit ceteris paribus. Using proxies for relationship lending and monitoring, we also find that these bank characteristics weaken the negative effect of public corruption on (...) lending. These results are robust to tests that address endogeneity, to the use of perception-based measures of corruption, and after controlling for credit demand conditions. In further analysis, we show that these effects are more evident for smaller banks and banks operating in a single state. These findings provide evidence that public corruption could facilitate information asymmetry in the lending market and, thus, could hinder local development by reducing bank credit. (shrink)

The impact of Islam upon women’s entrepreneurship in conflict zones is woefully absent from the entrepreneurship literature. This is due to the absence of published scholarship about this context rather than the absence of Muslim women’s entrepreneurship there. To address the gap in the literature, we offer a contextualized analysis and contribution by adopting an Islamic feminism lens and explore how Islamic feminism empowers women entrepreneurs and their entrepreneurial activities and behaviours in conflict zones. We argue that Islamic feminism is (...) a process of ‘ijtihad’ shaping the business ethics of Muslim women entrepreneurs operating in conflict zones and removing the traditional, patriarchal, colonial and other cultural layers with which Islam has been veiled. The findings from the 16 Muslim women entrepreneurs operating in Afghanistan, Iraq and Palestine and participating in our study reveal that Islamic religiousness plays a critical role in shaping the Muslim women’s entrepreneurial behaviour and their ability to endure the hardships of living in a conflict zone. Within all three research contexts, the participants interpreted and practiced their Islamic religiousness in ways consistent with Islamic Feminism principles and that deviated from patriarchal Islam dominating their conflict zones. This paper contributes to the growing research areas on Islamic feminist foundations for business ethics and women’s entrepreneurship in conflict zones by exploring how Islamic feminism empowers women entrepreneurs in Muslim conflict zones. (shrink)