Corruption, basic services and entrepreneurial venture performance: The case of informal production units in Cameroon

Abstract

Purpose

This paper aims to examine the relationship between the payment of bribes, the access to electricity and the productivity of informal production units (IPUs).

Design/methodology/approach

The data used for this study come from the second Survey on Employment and Informal Sector conducted in 2010 by the National Institute of Statistics of Cameroon and representative at the national level. The survey was conducted among 3,560 IPUs. Survey participants reported whether they had been personally affected by corruption in the twelve months preceding the survey. Relying on the data of this survey, the recursive trivariate probit model was used to study the correlation between corruption and access to electricity.

Findings

The results reveal that the payment of bribes positively influences IPU access to electricity, and consequently access to this infrastructure has a positive impact on company performance.

Research limitations/implications

A main limitation of this paper is the environment of study in which corruption appeared to be institutionalised. It would therefore be interesting to extend the results obtained by conducting research in other countries and also including other infrastructures such as telecommunications.

Practical implications

The main contribution of this research is to highlight the effectiveness of the fight against corruption and its impact on the access of some basics resources that affect the performance of certain companies. Indeed, the fight against corruption would be easier if economic actors had access to certain resources and fundamental infrastructures for their activities. Thus, improving the supply of resources and infrastructures can be an important lever in the fight against corruption in Africa.

Originality/value

This research addresses a vulnerable sector vis-à-vis the pressure of the actors involved in the provision of a service essential to the activity of companies. It highlights the justification for accepting the use of corruption. Indeed, entrepreneurs are faced with a dilemma between moral standards on the one hand, and economic imperatives on the other. If corruption is a condition of access to electricity which, in turn, improves performance, it is easy to pay bribes to gain access to electricity.

Citation

Modeste, A.A. and Bakehe, N.P. (2024), "Corruption, basic services and entrepreneurial venture performance: The case of informal production units in Cameroon", Journal of Small Business and Enterprise Development, Vol. 31 No. 1, pp. 174-190. https://doi.org/10.1108/JSBED-05-2022-0237