Does formality improve micro-firm performance? Evidence from the Brazilian SIMPLES program

Fajnzylber, Pablo; Maloney, William F.; Montes‐Rojas, Gabriel

doi:10.1016/j.jdeveco.2010.01.009

Cited by 210 publications

(195 citation statements)

References 14 publications

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“…The study employed two estimation approaches, which yielded slightly different results, but the overall message remained the same. The SIMPLES program had an effect on formalization across all the dimensions measured under both estimation approaches: an 11.6% or 7.1% increase in licensing rates, a 7.5% or 6.4% increase in the number of firms registered as legal entities, a 6.3% or 5.7% increase in micro-firm registration, a 7.2% or 2.8% (not significant) increase in tax registration, a 3.1% or 4.6 % increase in tax payments, and a 4.3% or -1.4% (not significant) change in social security contributions [5].…”

Section: World Of Labormentioning

confidence: 94%

“…Another study examined the effect of the introduction of SIMPLES on a range of formality dimensions: license to operate, legal entity, micro-firm registration, registration with tax authorities, paid taxes, and paid social security [5]. The study employed two estimation approaches, which yielded slightly different results, but the overall message remained the same.…”

Section: World Of Labormentioning

confidence: 99%

“…Consistent with [4], formality rates were highest for firms in the retail sector. In addition, after the introduction of SIMPLES, formalization increased among transportation firms, restaurants, and lodging facilities and declined among manufacturing, construction, and personal services firms [5].…”

Section: World Of Labormentioning

confidence: 99%

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Formalization of jobs and firms in emerging market economies through registration reform

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Section: World Of Labormentioning

confidence: 94%

Section: World Of Labormentioning

confidence: 99%

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Formalization of jobs and firms in emerging market economies through registration reform

Khamis¹

2014

IZAWOL

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“…Indirect support to SMEs may include policies regarding business registration, property registration, and regulatory frameworks (Fajnzylber et al, 2011;Monteiro and Assunção, 2012;McKenzie, 2013). …”

Section: Assumptionmentioning

confidence: 99%

The Impact of Business Support Services for Small and Medium Enterprises on Firm Performance in Low- and Middle-Income Countries: A Meta-Analysis

Cravo¹,

Piza²

2016

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license. Terms of use: Documents inFollowing a peer review process, and with previous written consent by the Inter-American Development Bank (IDB), a revised version of this work may also be reproduced in any academic journal, including those indexed by the American Economic Association's EconLit, provided that the IDB is credited and that the author(s) receive no income from the publication. Therefore, the restriction to receive income from such publication shall only extend to the publication's author(s). With regard to such restriction, in case of any inconsistency between the Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives license and these statements, the latter shall prevail.Note that link provided above includes additional terms and conditions of the license.The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent.http://www.iadb.org 2016 AbstractInterventions designed to support small and medium enterprises (SMEs) are popular among policy makers, given the role SMEs play in job creation around the world. Business support interventions in low-and middle-income countries (LMICs) are often based on the assumption that market failures and institutional constraints impede the growth of SME growth. Significant resources from governments and international organizations are directed to SMEs to maximize their socioeconomic impact. Business-support interventions in LMICs most often relate to formalization and business environments, exports, value chains and clusters, training and technical assistance, and access to credit and innovation. Very little is known about the impact of such interventions despite the abundance of resources directed to SME business-support services. This paper systematically reviews and summarizes 40 rigorous evaluations of SME-support services in LMICs and presents evidence to help inform policy debates. The study found indicative evidence that overall business-support interventions help improve f...

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“…For example, formal firms might spend resources to distinguish or protect themselves from informal firms, which might reduce the productivity of formal firms. Most of the literature on firm formality has focused on the effects of the firm's formality status on its own performance (e.g., La Porta andSchleifer, 2008, andFajnzylber, Maloney andMontes-Rojas, 2009). To the best of our knowledge, there is no work looking at the effects informal firms have on the behavior of other firms in the same sector.…”

Section: Introductionmentioning

confidence: 99%

Credit Constraints, Sector Informality and Firm Investments: Evidence from a Panel of Uruguayan Firms

Gandelman

Rasteletti

2013

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent. Terms of use: Documents inThe unauthorized commercial use of Bank documents is prohibited and may be punishable under the Bank's policies and/or applicable laws. Copyright ©Inter-American Development Bank. This working paper may be reproduced for any non-commercial purpose. It may also be reproduced in any academic journal indexed by the American Economic Association's EconLit, with previous consent by the Inter-American Development Bank (IDB), provided that the IDB is credited and that the author(s) receive no income from the publication. This paper explores whether the extent of informality in a sector affects a firm's investment decision directly or indirectly through a credit availability channel. The dataset used in the estimation of the econometric models consists of an unbalanced panel of Uruguayan firms for the period 1997-2008. The results suggest that financial restrictions affect investment decisions in Uruguay, as an increase in credit to the private sector translates into higher investment rates. A one percentage point increase in overall credit growth translates into a one half percent increase in investment rates. It is also found that, although there is no direct effect of informality on the firm investment decision, there is an indirect effect through the borrowing channel. More specifically, financial restrictions reduce the amount of investment undertaken by Uruguayan firms, the effect being smaller if the firm operates in a sector with lower informality. Cataloging-in-PublicationJEL classifications: E26, G21, O4, O16

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Does formality improve micro-firm performance? Evidence from the Brazilian SIMPLES program

Cited by 210 publications

References 14 publications

Formalization of jobs and firms in emerging market economies through registration reform

Formalization of jobs and firms in emerging market economies through registration reform

The Impact of Business Support Services for Small and Medium Enterprises on Firm Performance in Low- and Middle-Income Countries: A Meta-Analysis

Credit Constraints, Sector Informality and Firm Investments: Evidence from a Panel of Uruguayan Firms

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