Title: Corruption and the ethical context of country-level entrepreneurship

Authors: Sergey Anokhin; William Acar

Addresses: Graduate School of Management, Kent State University, P.O. Box 5190, Kent, OH 44242-0001, USA. ' Graduate School of Management, Kent State University, P.O. Box 5190, Kent, OH 44242-0001, USA

Abstract: By marrying the ethics literature with classic entrepreneurship ideas, we conceptualise corruption as a form of business risk and draw parallels between societal ethical standards and uncertainty. We propose that important insights into understanding ethical standards may be developed by comparing the levels of perceived and actual corruption. We use cross-country comparisons as our level of analysis and employ data from 64 countries over the period of 1996-2002, collected from multiple reputable international organisations. Statistical support is found for an inverted U-shaped relationship between the level of ethical standards and domestic innovative activities, as well as net inflows of foreign direct investments. Our results suggest that moderate levels of ethical standards are most conducive to both domestic innovative activities and foreign involvement into economic life of a country.

Keywords: country-level entrepreneurship; ethics; business risk; uncertainty; domestic innovation; ethical standards; perceived corruption; actual corruption; net inflows; foreign direct investment; FDI; foreign involvement.

DOI: 10.1504/IJEV.2012.049830

International Journal of Entrepreneurial Venturing, 2012 Vol.4 No.4, pp.391 - 408

Received: 08 May 2021
Accepted: 12 May 2021

Published online: 16 Oct 2012 *

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