TY  - JOUR
AU  - Braguinsky, Serguey
AU  - Mityakov, Sergey V
TI  - Foreign Corporations and the Culture of Transparency: Evidence from Russian Administrative Data
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17731
PY  - 2012
Y2  - January 2012
DO  - 10.3386/w17731
UR  - http://www.nber.org/papers/w17731
L1  - http://www.nber.org/papers/w17731.pdf
N1  - Author contact info:
Serguey Braguinsky
University of Maryland
Robert H. Smith School of Business and
Department of Economics
4558 Van Munching Hall
College Park, MD 20742
E-Mail: sbraguinsky@rhsmith.umd.edu

Sergey V. Mityakov
Department of Finance
Florida State University
E-Mail: Smityakov@fsu.edu
M1  - published as Serguey Braguinsky, Sergey Mityakov. "Foreign Corporations and the Culture of Transparency: Evidence from Russian Administrative Data," in Luigi Zingales and James Poterba, organizers, "Causes and Consequences of Corporate Culture" Elsevier, Journal of Financial Economics 117(1) (2015)

M3  - presented at "Causes and Consequences of Corporate Culture", December 8-9, 2011
AB  - Foreign-owned firms from advanced countries carry the culture of transparency in business transactions that is orthogonal to the culture of hiding and insider dealing in many developing economies and economies in transition. In this paper, we document this using administrative data on reported earnings and market values of cars owned by workers employed in foreign-owned and domestic firms in Moscow, Russia. We examine whether closer ties to foreign corporations result in the diffusion of transparency to private Russian firms. We find that Russian firms initially founded in partnerships with foreign corporations are twice as transparent in reported earnings of their workers as other Russian firms, but they are still less than half as transparent as foreign firms themselves. We also find that increased links to foreign corporations, such as hiring more workers from them, raise the transparency of domestic firms. An important channel for this transmission appears to be the need to keep official wages and salaries of incumbent workers close to wages domestic firms have to pay to their newly hired workers with experience in multinationals.
ER  -