The Effect of Corruption on Business Performance in Tanzania: A Review Paper, 2020.

Abstract

The purpose of this review is to examine the effects of corruption on business performance in Tanzania. Corruption has been in existence since time immemorial. In Africa and Tanzania in particular, corruption has many faces and has got its causes from various sources. Apart from causes and its impacts on the economy, the paper has discussed the possible remedies to ensure that corruption is curbed for sustainable development using the findings from various empirical studies. Different Scholars have argued that corruption has many negative effects on business performance in a particular country. In the international business, for example, corruption can affect the entry strategy of a company, international joint ventures and the performance subsidiaries. Krueger (2009) argued that international firms doing business in China faced ethical issues due to the itarian government, lack of transparency, and the high level of corruption. Jensen, Li, and Rahman (2010) report that in a political environment where freedom of the press is restricted firms utilize a no comment or false disclosure option as a self-protection strategy. Petrou (2014) finds that arbitrary corruption hurts the performance of subsidiaries. Therefore, to have sustainable and solid business performance in a country, the government should opt for good governance measures and corruption-free zone because weak governance leads to waste, mismanagement, and corruption.