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From lower levels of formality to a formal firm in Ecuador: Short-run evidence

Author

Listed:
  • Segundo Camino-Mogro

    (Universidad de Especialidades Espíritu Santo)

  • Juan Manuel Dominguez

    (Escuela Superior Politécnica del Litoral, ESPAE Graduate School of Management.)

  • María Auxiliadora Guzman

    (Universidad Católica de Santiago de Guayaquil; Universidad Castilla La Mancha)

Abstract

This paper evaluates the impact of an entry deregulation on the change from a less formal business to a higher level of formality of a business in Ecuador by analyzing a recent reform called Sociedad por Acciones Simplificadas (SAS). We use novel and under-explore administrative data sets and apply a difference-in-difference approach comparing the physical (in-person) to the electronic firm creation schemes, before and after the policy implementation. We find that the reform does not increase the probability of changing from a less formal business to the highest level of formalization in the short-run.

Suggested Citation

  • Segundo Camino-Mogro & Juan Manuel Dominguez & María Auxiliadora Guzman, 2025. "From lower levels of formality to a formal firm in Ecuador: Short-run evidence," Economics Bulletin, AccessEcon, vol. 45(1), pages 668-677.
    • Handle: RePEc:ebl:ecbull:eb-23-00504
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    Bureaucracy; entry regulation; informality;
    All these keywords.

    JEL classification:

    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • D7 - Microeconomics - - Analysis of Collective Decision-Making

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