The impact of bribery to the financial behavior

By Dao Nguyen Quynh Giao (VNP 24)

Supervisor: Dr. Vu Thi Hong Nhung

Abstract:

This study discusses the impact of bribery on the financial behavior of SMEs in Vietnam. With observations of 166 SMEs across Vietnam, statistical information on bribery (including the ratio of bribes to firm revenue, known as bribery ratio and bribery frequency), Relationship with government agencies, Transparency of local government policies, Informal payers and financial practices (including total expenditure, total borrowing and total investment). Then, this study deployed a set of empirical tests, including Correlation Matrix, Regression t Test, F-test, Durbin - Watson multicollinearity test to test the relationship between variables as well as check the reliability of the results. This study found that bribery rate, bribery frequency and informal expenditures had a positive effect on total spending and total investment and total borrowing. However, the relationship with the government and the level of government transparency have a negative impact on the financial behavior of SMEs. The research results can serve as a basis for the government to build a more transparent administrative apparatus, contributing to improving the socio-economic life of Vietnam.