The propensity to bribe in international business: the relevance of cultural variables

Purpose – This paper seeks to examine the extent to which national cultural characteristics impact the propensity of firms based in the country to engage in bribery to gain advantages when conducting business overseas. Design/methodology/approach – A set of statistical analyses – bivariate correlations and regression – was performed on data for five cultural variables and one economic variable for 30 countries to ascertain the relationship between these variables on a country's Bribe Payers Index , a measure of bribe giving. Findings – The results indicate that firms from countries low on power distance or long‐term orientation, or high on individualism, are less likely to engage in bribe giving. However, when the level of economic development in the home country as measured by per capita income is included, the impact of cultural factors is muted considerably. Firms from high‐income countries are less likely to give bribes. Research limitations/implications – Richer countries are likely to have certain practices that create a business ethos where bribing is the exception, not the rule, in conducting business. The study is based on a one‐time sample of just 30 countries for which bribe‐giving data are available. The data culture is limited to the countries studied by Hofstede. Practical implications – Bribery is less a cultural phenomenon; instead, it is bred in poverty and illustrative of business behavior occurring in a highly regulated and inward‐looking economy. As a country prospers and the domestic operating environment becomes more hygienic, it will have a salutary effect on the international behavior of the firms based in that country. Originality/value – The study mediates the debate between cultural and economic determinism and provides empirical evidence that bribe‐giving is largely an expression of economic imperatives and not cultural predisposition.