The Impact of Technology Development on Firm Corruption Pressure and Moderating Effects of Institutional Quality

Abstract

Corruption has come to occupy an enduring place in the management literature, not least in nonmarket strategy research. However, in the wake of transformative change brought about by technology development, the relationship between technology and corruption has remained understudied. While previous studies have explored the effects of increased technology on corruption at the country level, few studies to date address the effects of expanding technology development on corruption as it is experienced by firms. Using a large-scale sample of cross-country survey data from interviews of firm managers, this study seeks to begin to address this gap in the literature by providing empirical analysis of the relationship between technology development and corruption pressure on firms. The study finds that technology development has a significant effect in reducing corruption at the firm level. The study further considers the contingent impacts of variations in the institutional context from country to country and how institutional quality moderates the relationship between technology and corruption. Theoretical and managerial implications for researchers and practitioners are then discussed.