How export shocks corrupt: Theory and evidence

Corruption is an important topic for governments and economics. A widely held belief that exposure to international trade helps reducing corruption. In this article we show through theory evidence the relationship between corruption more nuanced. We firm level actually increases when exports experience booms or busts. The reason export result in stronger incentives favor production rather than low settings, vice versa high settings. Consequently, busts are very low, high, lead both higher corroborate these findings with extensive database of some 45,000 firms from 72 developing transition economies, surveyed over 2006-2017. also confirm corruption-deterrent effect institutional quality.