Social capital as a substitute for formality: Evidence from Bolivia
The paper studies the role of social capital in the urban informal sector in Bolivia. It shows that a formal firm has about 6.4 times the sales of an informal firm with no social capital, but informal firms use their social capital to compensate for the lack of formal productivity benefits. By being formal, firms obtain permanent visibility because they can operate a shop or a visible production location and they can produce in locations with better public infrastructure. Informal firms, in contrast, sell in one place – typically in street markets in front of formal shops – and produce in another — typically in the outskirts. Social capital increases accessibility of informal firms and provides them with security benefits at their production location.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- McKenzie, David & Sakho, Yaye Seynabou, 2007.
"Does It Pay Firms to Register for Taxes? The Impact of Formality on Firm Profitability,"
IZA Discussion Papers
3179, Institute for the Study of Labor (IZA).
- McKenzie, David & Seynabou Sakho, Yaye, 2010. "Does it pay firms to register for taxes? The impact of formality on firm profitability," Journal of Development Economics, Elsevier, vol. 91(1), pages 15-24, January.
- McKenzie, David & Sakho, Yaye Seynabou, 2007. "Does it pay firms to register for taxes ? the impact of formality on firm profitability," Policy Research Working Paper Series 4449, The World Bank.
- Woodruff, Christopher, 1998. "Contract enforcement and trade liberalization in Mexico's footwear industry," World Development, Elsevier, vol. 26(6), pages 979-991, June.
- Anke Kessler & Christoph Lülfesmann, 2004. "Bilateral bargaining, unverifiable quality, and options to return," Economic Theory, Springer, vol. 23(2), pages 395-410, January.
- Beckmann, Volker & Boger, Silke, 2003.
"Courts And Contract Enforcement In Transition Agriculture: Theory And Evidence From Poland,"
2003 Annual Meeting, August 16-22, 2003, Durban, South Africa
25878, International Association of Agricultural Economists.
- Beckmann, Volker & Boger, Silke, 2004. "Courts and contract enforcement in transition agriculture: theory and evidence from Poland," Agricultural Economics, Blackwell, vol. 31(2-3), pages 251-263, December.
- Marcel Fafchamps, 2005.
"Development and Social Capital,"
Economics Series Working Papers
GPRG-WPS-007, University of Oxford, Department of Economics.
- Steven N. Durlauf & Marcel Fafchamps, 2004.
NBER Working Papers
10485, National Bureau of Economic Research, Inc.
- Marcel Fafchamps & Steven N. Durlauf, 2004. "Social Capital," Economics Series Working Papers WPS/2004-14, University of Oxford, Department of Economics.
- Durlauf,S.N. & Fafchamps,M., 2004. "Social capital," Working papers 12, Wisconsin Madison - Social Systems.
- Steven N. Durlauf & Marcel Fafchamps, 2004. "Social Capital," CSAE Working Paper Series 2004-14, Centre for the Study of African Economies, University of Oxford.
- Steven Durlauf & Marcel Fafchamps, 2004. "Social Capital," Development and Comp Systems 0409060, EconWPA.
- Annen, Kurt, 2003. "Social capital, inclusive networks, and economic performance," Journal of Economic Behavior & Organization, Elsevier, vol. 50(4), pages 449-463, April.
- Besley, Timothy J. & Persson, Torsten, 2007.
"The Origins of State Capacity: Property Rights, Taxation, and Politics,"
CEPR Discussion Papers
6370, C.E.P.R. Discussion Papers.
- Timothy Besley & Torsten Persson, 2009. "The Origins of State Capacity: Property Rights, Taxation, and Politics," American Economic Review, American Economic Association, vol. 99(4), pages 1218-44, September.
- Timothy Besley & Torsten Persson, 2007. "The Origins of State Capacity: Property Rights, Taxation, and Politics," NBER Working Papers 13028, National Bureau of Economic Research, Inc.
- Timothy Besley & Torsten Persson, 2009. "The origins of state capacity: property rights, taxation and politics," LSE Research Online Documents on Economics 33768, London School of Economics and Political Science, LSE Library.
- Grootaert, Christiaan & Narayan, Deepa, 2004. "Local Institutions, Poverty and Household Welfare in Bolivia," World Development, Elsevier, vol. 32(7), pages 1179-1198, July.
- Axel Dreher & Christos Kotsogiannis & Steve McCorriston, 2009.
"How do institutions affect corruption and the shadow economy?,"
International Tax and Public Finance,
Springer, vol. 16(6), pages 773-796, December.
- Axel Dreher & Christos Kotsogiannis & Steve McCorriston, 2005. "How do Institutions Affect Corruption and the Shadow Economy?," Public Economics 0502012, EconWPA, revised 24 Feb 2005.
- Axel Dreher & Christos Kotsogiannis & Steve McCorriston, 2005. "How Do Institutions Affect Corruption and the Shadow Economy," Discussion Papers 0505, Exeter University, Department of Economics.
- repec:cup:cbooks:9780521348911 is not listed on IDEAS
- Kurt Annen, 2001. "Inclusive and Exclusive Social Capital in the Small-Firm Sector in Developing Countries," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 157(2), pages 319-, June.
- Grigor Sukiassyan & Jeffrey Nugent, 2008. "Associations versus registration as alternative strategies of small firms," Small Business Economics, Springer, vol. 31(2), pages 147-161, August.
- Simon Johnson & John McMillan, 2002.
"Courts and Relational Contracts,"
Journal of Law, Economics and Organization,
Oxford University Press, vol. 18(1), pages 221-277, April.
- Krishna, Anirudh, 2001. "Moving from the Stock of Social Capital to the Flow of Benefits: The Role of Agency," World Development, Elsevier, vol. 29(6), pages 925-943, June.
- Ahlerup, Pelle & Olsson, Ola & Yanagizawa, David, 2007. "Social Capital vs Institutions in the Growth Process," Working Papers in Economics 248, University of Gothenburg, Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:eee:poleco:v:31:y:2013:i:c:p:82-92. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.