Crime and Security in Eastern Europe and Central Asia: Firm Level Analysis (A Short Note)

Type Working Paper
Title Crime and Security in Eastern Europe and Central Asia: Firm Level Analysis (A Short Note)
Author(s)
Publication (Day/Month/Year) 2010
URL http://www.enterprisesurveys.org/~/media/FPDKM/EnterpriseSurveys/Documents/Enterprise​Notes/Crime-15.pdf
Abstract
About 20 percent of the firms in the Eastern Europe and Central Asia region are victims of crime during a year. While losses to firms due to crime incidents average 0.48 percent of a firm’s annual sales, expenses by firms on security average 1.42 percent of their annual sales. These two costs equaling 1.9 percent of annual sales of a firm are about 8 times what firms spend on R&D and 1.8 times the reported amount paid in bribery. Surprisingly, rich countries do not score over poor ones on crime related problems. Last, while large firms are more likely to be victims of crime than the small firms, losses from crime are much heavier on the smaller firms. Other characteristics of a firm do not matter much for the extent of crime it faces with the exception of the industry to which it belongs and whether it innovates or not.

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