Corruption and entrepreneurship: does gender matter?

Abstract

Corruption is a significant factor which determines the quality of the “doing business” environment at large. The aim of this paper is to contribute to our understanding of entrepreneurs’ corrupt behavior by looking at two questions: (1) does gender matter in corrupt behavior and (2) can corruption be an explanatory factor for gender gaps in firm growth. While it is often argued that female entrepreneurs face gender-specific challenges and might have different behaviors based on different ethics and moral standards, it is crucial to seek for empirical evidence at microeconomic level. Our results indicate that women entrepreneurs do have a significant lower propensity to bribe as compared to men entrepreneurs. Looking at the impact of corruption on employment growth, we do find a general negative impact of administrative corruption especially for micro enterprise but a positive one for women entrepreneurs. This is consistent with the fact that the majority of women are micro entrepreneurs; for them it is easier to escape the attention of corrupt officials, but greasing the wheels of state bureaucracy might become necessary and facilitate their firm’s growth.