Economics Seminar: Fatma Nur Karaman (Yaşar University)

ABSTRACT

Although the effect of corruption on country-level investment is studied widely in literature, only a limited number of research has sought to understand how corruption affects firm-level innovation. Using firm-level data for twenty seven Eastern European and Central Asian countries, we empirically investigate how corruption affects innovation. We find that corruption has a positive effect on the rate of innovation. This finding is robust to alternative measurement proxies.