R M B www.irmbrjournal.com December 2014 R International Review of Management and Business Research Vol. 3 Issue.4 I Causes of Corruption from Entrepreneurs’ Perceptions: Theoretical and Practical Implications. MUSSIE T. TESSEMA Ph.D., Business Administration Dept, Winona State University, MN. Som323F. Email:
[email protected] Tel. 507-457-2571 MENGSTEAB TESFAYOHANNES-BERAKI Ph.D., Susquehanna University Email:
[email protected] SEBHATLEAB TEWOLDE Ph.D., Department of Accounting, University of Asmara Email:
[email protected] KIFLEYESUS ANDEMARIAM Ph.D., Department of Management, University of Asmara Email:
[email protected] Abstract This study assesses the extent to which ten selected factors affect corruption in Least Developed Countries (LDCs). The study uses Eritrea as a case study and delves into the causes and challenges of corruption in LDCs. The findings of the study support several previously conducted studies in that each factor examined had a moderate to high positive correlation with corruption, where r ranged between .47 and .59. In addition, the ten variables together explain about 73 percent change in perceived corruption (R2= .73). The study acknowledges that corruption is multifaceted and complicated, involving economic, political, and social-cultural factors and has no „quick fix‟ and thus needs proper planning, determination, resilience, and above all, political will. Implications of these findings and future research directions are discussed. Key Words: Governance, Accountability, Corruption, LDCs, Eritrea, Entrepreneurs, Business Eethics. Introduction One of the main tasks assumed by governments world-wide is promoting economic and social development. If these tasks are to be accomplished successfully, a number of pre-conditions must exist.