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Entry regulation and business start-ups : evidence from Mexico

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  • Kaplan, David S.
  • Piedra, Eduardo
  • Seira, Enrique

Abstract

The authors estimate the effect on business start-ups of a program that significantly speeds up firm registration procedures. The program was implemented in Mexico in different municipalities at different dates. Authors estimates suggest that new start-ups increased by about 4 percent in eligible industries, and the authors present evidence that this is a causal effect. Most of the effect is temporary, concentrated in the first 10 months after implementation. The effect is robust to several specifications of the benchmark control group time trends. The authors find that the program was more effective in municipalities with less corruption and cheaper additional procedures.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4322.

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Date of creation: 01 Aug 2007
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Handle: RePEc:wbk:wbrwps:4322

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Keywords: Corporate Law; Microfinance; Regional Governance; Urban Governance and Management; Urban Partnerships&Poverty;

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References

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  1. Straub, Stéphane, 2005. "Informal sector: The credit market channel," Journal of Development Economics, Elsevier, vol. 78(2), pages 299-321, December.
  2. Djankov, Simeon & La Porta, Rafael & López-de-Silanes, Florencio & Shleifer, Andrei, 2001. "The Regulation of Entry," CEPR Discussion Papers 2953, C.E.P.R. Discussion Papers.
  3. Sebastian Galiani & Paul Gertler & Ernesto Schargrodsky, 2002. "Water for Life: The Impact of the Privatization of Water Services on Child Mortality," Working Papers 54, Universidad de San Andres, Departamento de Economia, revised Sep 2005.
  4. Bruhn, Miriam, 2008. "License to sell : the effect of business registration reform on entrepreneurial activity in Mexico," Policy Research Working Paper Series 4538, The World Bank.
  5. Kaplan, David S. & Piedra, Eduardo & Seira, Enrique, 2007. "Entry regulation and business start-ups : evidence from Mexico," Policy Research Working Paper Series 4322, The World Bank.
  6. Susan Athey & Scott Stern, 2000. "The Impact of Information Technology on Emergency Health Care Outcomes," NBER Working Papers 7887, National Bureau of Economic Research, Inc.
  7. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1988. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 495-515, Winter.
  8. Friedrich Schneider & Dominik Enste, 2000. "Shadow Economies Around the World - Size, Causes, and Consequences," IMF Working Papers 00/26, International Monetary Fund.
  9. Djankov, Simeon & Qian, Yingyi & Roland, Gérard & Zhuravskaya, Ekaterina, 2006. "Who Are China's Entrepreneurs?," CEPR Discussion Papers 5706, C.E.P.R. Discussion Papers.
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  11. Yoonsoo Lee & Toshihiko Mukoyama, 2008. "Entry, Exit, and Plant-Level Dynamics over the Business Cycle," Working Papers 08-17, Center for Economic Studies, U.S. Census Bureau.
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  14. Aureo de Paula & Jose A Sheinkman, 2007. "The Informal Sector," Levine's Bibliography 122247000000001663, UCLA Department of Economics.
  15. Bertrand, Marianne & Kramarz, Francis, 2002. "Does Entry Regulation Hinder Job Creation? Evidence from the French Retail Industry," IZA Discussion Papers 415, Institute for the Study of Labor (IZA).
  16. Castellanos, Sara G. & Garcia-Verdu, Rodrigo & Kaplan, David S., 2004. "Nominal wage rigidities in Mexico: evidence from social security records," Journal of Development Economics, Elsevier, vol. 75(2), pages 507-533, December.
  17. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," NBER Working Papers 6699, National Bureau of Economic Research, Inc.
  18. Susan Athey & Scott Stern, 2002. "The Impact of Information Technology on Emergency Health Care Outcomes," RAND Journal of Economics, The RAND Corporation, vol. 33(3), pages 399-432, Autumn.
  19. World Bank & International Finance Corporation, 2006. "Doing Business 2007 : How to Reform," World Bank Publications, The World Bank, number 7245, 5.
  20. David Kaplan & Eduardo Piedra & Enrique Seira, 2006. "Are Burdensome Registration Procedures an Important Barrier on Firm Creation? Evidence from Mexico," Discussion Papers 06-013, Stanford Institute for Economic Policy Research.
  21. Dominik H. Enste & Friedrich Schneider, 2000. "Shadow Economies: Size, Causes, and Consequences," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 77-114, March.
  22. Djankov, Simeon & McLiesh, Caralee & Ramalho, Rita Maria, 2006. "Regulation and growth," Economics Letters, Elsevier, vol. 92(3), pages 395-401, September.
  23. Klapper, Leora & Laeven, Luc & Rajan, Raghuram, 2006. "Entry regulation as a barrier to entrepreneurship," Journal of Financial Economics, Elsevier, vol. 82(3), pages 591-629, December.
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  1. Business registration and informality
    by Straub in Stephane Straub on 2012-03-20 09:12:11
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