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Subika Farazi, Ahmed M Rostom and Rishabh Sinha
''Investment decisions and exposure to crime and corruption.''
( 2020, Vol. 40 No.3 )
Using firm-level data from Afghanistan, we find that undertaking investment raises the likelihood of experiencing episodes of crime and corruption. Our analysis suggests that firms more prone to criminal attacks are aware of the risks and accordingly make costly security arrangements to mitigate the impact. The likelihood of security spending is higher for formal firms and those having access to finance. The two policy instruments increase the availability of resources, some of which is spent to fight crime.
Keywords: Conflict, Corruption, Investment, Afghanistan, Firms
JEL: D2 - Production and Organizations: General
D7 - Analysis of Collective Decision-Making: General
Manuscript Received : Aug 28 2019 Manuscript Accepted : Aug 19 2020

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