Cai, Hongbin; Fang, Hanming; Xu, Lixin Colin - In: Journal of Law and Economics 54 (2011) 1, pp. 55-55
We propose entertainment and travel costs (ETC) expenditures as a measure of corruption in Chinese firms. These expenses are publicly reported in firms’ accounting books, and on average they amount to about 3 percent of a firm’s total value added. We find that ETC is a mix that includes...