Corruption and foreign direct investments in developing countries

Master's Thesis from the year 2019 in the subject Business economics - Investment and Finance, grade: 1,7, University of Paderborn, language: English, abstract: Corruption is generally accepted as a phenomenon which is occurring worldwide. Nevertheless, the data which is quantifying its manifestation showcase geographical as well as cultural differences. Unscrupulous governments, non existing economic prosperity, a high degree of political instability and a population deeply afflicted by poverty are the most conspicuous explanations for elevated levels of corruption.

This Thesis explores the nexus between corruption and FDI especially in developing and 3rd world countries.

Consequently, the aim of this thesis is to analyze the interplay between corruption and FDI inflows. The principal question is hereby under which circumstances investors seem to "overlook" potential grievances in the recipient countries and which effect el-evated FDI inflows have on the prosperity of the beneficiary economy. By exploring the repercussions FDI has on economic growth, in the further course and in a separate section, the thesis devotes special attention to developing countries.