IDEAS home Printed from https://ideas.repec.org/a/ila/anaeco/v31y2016i1p15-36.html
   My bibliography  Save this article

Economy-Wide Effects of Improving Small Firms Access to Capital Markets: An Applied General Equilibrium Assessment

Author

Listed:
  • Omar O. Chisari

    () (Instituto de Economía UADE and CONICET)

  • Carlos Adrián Romero

    () (Instituto de Economía UADE)

  • Juan Pablo Vila Martínez

    () (Departamento de Economía y Finanzas UADE)

Abstract

Is it possible to increase GDP, reduce unemployment and improve income distribution by giving small firms better access to capital markets? This paper argues that an answer to that question could be affirmative. However, it also shows that self-exclusion of small firms from programs of access to capital markets conditional on higher formalization is a plausible scenario. Formalization could be expensive for them in terms of higher effective taxes and costs of compliance with norms and standards. The paper gives also estimates of the required gains in productivity that could induce firms to become more formal and access the capital markets at a lower cost of capital. To address those issues we use a general equilibrium approach for the Argentine economy to have the economy wide impacts and costs, i.e. including the effect on other sectors of the reallocation of resources to small firms.

Suggested Citation

  • Omar O. Chisari & Carlos Adrián Romero & Juan Pablo Vila Martínez, 2016. "Economy-Wide Effects of Improving Small Firms Access to Capital Markets: An Applied General Equilibrium Assessment," Revista de Analisis Economico – Economic Analysis Review, Universidad Alberto Hurtado/School of Economics and Business, vol. 31(1), pages 15-36, April.
  • Handle: RePEc:ila:anaeco:v:31:y:2016:i:1:p:15-36
    as

    Download full text from publisher

    File URL: https://www.rae-ear.org/index.php/rae/article/view/424
    Download Restriction: no

    More about this item

    Keywords

    Small business; applied general equilibrium; access to capital markets;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ila:anaeco:v:31:y:2016:i:1:p:15-36. 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: (Mauricio Tejada). General contact details of provider: http://edirc.repec.org/data/deilacl.html .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.