Table 5: Results of the main estimation

|||paid bribe|||bribe burde|n||informal gif|t||bribe%sales||corr. p|erception|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
||(1)|(2)|(3)|(4)|(5)|(6)|(7)|(8)|(9)|(10)|(11)|(12)|(13)|(14)|
|est. method|lpm|pr|ape|lpm|tob|ape|lpm|pr|ape|lpm|tob|ape|2005|2007|
|dec. index, main|-0.13|-0.93|-0.17|-6.01*|-29.39|-2.99|-0.68*|-2.25*|-0.55*|-4.55|-17.15|-4.62|4.14**|5.03***|
||(0.16)|(0.89)|(0.16)|(3.32)|(32.59)|(7.45)|(0.38)|(1.25)|(0.31)|(3.28)|(12.63)|(8.53)|(1.83)|(1.51)|
|exp. decentr.|-0.04|-0.26||-2.37*|-8.26||-0.25|-0.93||-3.11*|-8.27||1.10|1.48|
||(0.09)|(0.43)||(1.41)|(15.38)||(0.17)|(0.58)||(1.71)|(6.58)||(1.01)|(0.92)|
|dec. index, aux.|-0.02|-0.24||-3.08|-6.78||-0.29|-1.16*||-2.83*|-10.04||1.96|2.39**|
||(0.11)|(0.52)||(1.91)|(19.27)||(0.19)|(0.62)||(1.59)|(6.46)||(1.24)|(1.10)|
|1 LG tier|0.04|0.30|0.06|-0.54|11.74|1.36|-0.10**|-0.33**|-0.07***|0.34|0.37|0.10|0.83**|0.78**|
||(0.04)|(0.20)|(0.04)|(0.60)|(7.90)|(1.95)|(0.04)|(0.14)|(0.03)|(0.44)|(2.03)|(1.08)|(0.39)|(0.35)|
|2 LG tiers|0.00|0.12|0.02|-1.24**|4.88|0.50|-0.11**|-0.32***|-0.08***|-0.07|-1.50|-0.4|0.41|0.35|
||(0.02)|(0.11)|(0.02)|(0.56)|(4.35)|(1.48)|(0.04)|(0.12)|(0.03)|(0.29)|(1.47)|(0.69)|(0.27)|(0.22)|
|UK legal origin|-0.04|-0.21|-0.04|-2.24**|-11.20|-1.06|-0.05|-0.15|-0.03|-1.48***|-6.50***|-1.75|-0.09|-0.04|
||(0.04)|(0.24)|(0.04)|(0.89)|(8.71)|(2.67)|(0.05)|(0.17)|(0.04)|(0.48)|(2.31)|(1.14)|(0.35)|(0.31)|
|start business|-0.01|-0.03|-0.00|-0.14**|-0.82|-0.08|-0.00|0.00|0.00|0.09|0.24|0.07|-0.06|-0.04|
||(0.00)|(0.02)|(0.00)|(0.07)|(0.80)|(0.17)|(0.00)|(0.01)|(0.00)|(0.07)|(0.26)|(0.12)|(0.04)|(0.04)|
|enforce contract|-0.00|0.00|0.00|-0.00|0.21|0.02|0.01**|0.03**|0.01**|-0.05*|-0.24*|-0.07|-0.02|-0.02|
||(0.00)|(0.01)|(0.00)|(0.05)|(0.44)|(0.12)|(0.00)|(0.01)|(0.00)|(0.03)|(0.15)|(0.08)|(0.02)|(0.02)|
|gov. consumption|-0.01***|-0.03***|-0.01***|-0.09**|-1.35***|-0.14|-0.00|-0.01*|-0.00*|-0.01|0.04|0.01|0.02|0.01|
||(0.00)|(0.01)|(0.00)|(0.04)|(0.42)|(0.10)|(0.00)|(0.00)|(0.00)|(0.02)|(0.07)|(0.05)|(0.02)|(0.01)|
|log (GDP/capita)|-0.05***|-0.30***|-0.05***|-0.58*|-12.0***|-1.22*|-0.02|-0.12**|-0.03**|-0.26|-1.16*|-0.31|0.91***|0.78***|
||(0.01)|(0.06)|(0.01)|(0.32)|(3.08)|(0.71)|(0.02)|(0.05)|(0.01)|(0.16)|(0.70)|(0.57)|(0.14)|(0.11)|
|frm, ind. controls|ind|ind|ind|ind|ind|ind|frm|frm|frm|frm|frm|frm|no|no|
|dataset|GCB|GCB|GCB|GCB|GCB|GCB|WBES|WBES|WBES|WBES|WBES|WBES|CPI|CPI|
|standard errors|cluster|cluster|margef|cluster|cluster|bootstr.|cluster|cluster|margef|cluster|cluster|bootstr.|robust|robust|
|observations|36821|36821|36821|36296|36296||32775|32775|32775|33824|33824|118|118||
|R-squared|0.10|||0.05|||0.19|0.04||0.04|0.86|0.82|0.86||
|# countries|57|||57|||60|||60|||111|111|

Note<sup>∗</sup> - significant at 10% level,<sup>∗∗</sup> - significant at 5% level,<sup>∗∗∗</sup> - significant at 1% level. Dependent variable: columns (1)-(3) - paid bribe; columns (4)-(6) - paid bribe; columns (7)-(9) - informal gift; columns (10)-(12) - bribe%sales; column (13) - corruption perception, 2005 ; column (14) - corruption perception, 2007 (see definitions in Table 2). Estimation methods: columns (1), (4), (7), (10), (13), (14) - OLS; columns (2), (8) - probit; columns (5), (11) - tobit with lower limit at 0; columns (3), (6), (9), (12) - average partial effects over sample. Standard errors are reported in brackets: columns (1), (2), (4), (5), (7), (8), (10), (11) - clustered by country and heteroscedasticity robust; columns (13) (14) - heteroscedasticity robust; columns (3), (9) - estimated by margeff ; columns (6), (12) - cluster bootstraped (500 iterations). Additional controls are included in all regressions, but not reported here due to a lack of space. These are regional dummies, year dummies, individual and firm controls, population, openness, fractionalization, # of units, LG population size, LG area.