Informality, Harassment, and Corruption : Evidence from Informal Enterprise Data from Harare, Zimbabwe
New representative survey data for Harare, Zimbabwe are used to analyze the conditions under which informal businesses encounter requests for bribes. A simple model develops basic expectations of bribe exposure: those with higher opportunity costs...
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| Format: | Working Paper |
| Language: | English |
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World Bank, Washington, DC
2019
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| Online Access: | http://documents.worldbank.org/curated/en/410811561563187656/Informality-Harassment-and-Corruption-Evidence-from-Informal-Enterprise-Data-from-Harare-Zimbabwe http://hdl.handle.net/10986/31983 |
| Summary: | New representative survey data for
Harare, Zimbabwe are used to analyze the conditions under
which informal businesses encounter requests for bribes. A
simple model develops basic expectations of bribe exposure:
those with higher opportunity costs of formalizing and with
a higher ability to pay (resources) are expected to face a
higher bribe risk. Empirical results find that informal
businesses operating out of necessity are likelier to have a
bribe demanded of them. Robustness checks are performed to
account for the endogeneity of the main regressors, through
a bivariate probit specification, using an instrumental
variable of whether an informal business owner started in
the area of activity before the country's 2009
dollarization. Limited significant results are found for the
effect of revenues (ability to pay). |
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