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Evaluating The Impacts Of Starting Up Unregistered On Firm Performance In Africa

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  • COLIN C. WILLIAMS

    (Sheffield University School of Management (SUMS), University of Sheffield, Conduit Road, Sheffield S10 1FL, United Kingdom)

  • ABBI M. KEDIR

    (Sheffield University School of Management (SUMS), University of Sheffield, Conduit Road, Sheffield S10 1FL, United Kingdom)

Abstract

The aim of this paper is to contribute to an understanding of the entrepreneurship process in Africa by evaluating the link between starting up unregistered and future firm performance. The widespread assumption has been that firms starting up unregistered in the informal economy suffer from poor performance compared to those starting up registered and in the formal economy. To test this poorer performance thesis, World Bank Enterprise Survey (WBES) data is evaluated from across 41 African countries covering the period from 2006 to 2013. Controlling for a comprehensive set of other determinants of firm performance, the finding is that formal enterprises with five or more employees that started up unregistered have significantly higher annual sales, employment and productivity growth rates compared with those firms that registered their operations at startup. The paper concludes by discussing the theoretical and policy implications of this finding.

Suggested Citation

  • Colin C. Williams & Abbi M. Kedir, 2017. "Evaluating The Impacts Of Starting Up Unregistered On Firm Performance In Africa," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 22(03), pages 1-20, September.
    • Handle: RePEc:wsi:jdexxx:v:22:y:2017:i:03:n:s1084946717500170
    DOI: 10.1142/S1084946717500170
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    3. Colin C. Williams & Brunilda Kosta, 2019. "Evaluating Institutional Theories Of Informal Sector Entrepreneurship: Some Lessons From Albania," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 24(02), pages 1-17, June.
    4. Eijaz Ahmed Khan, 2018. "The Voice Of Informal Entrepreneurs: Resources And Capabilities Perspective," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 23(03), pages 1-19, September.
    5. Colin C. Williams & Abbi M. Kedir, 2019. "Explaining cross-country variations in the prevalence of informal sector competitors: lessons from the World Bank Enterprise Survey," International Entrepreneurship and Management Journal, Springer, vol. 15(3), pages 677-696, September.
    6. Hussein Alkhyyoon & Mohammad Reza Abbaszadeh & Farzaneh Nassir Zadeh, 2023. "Organizational Risk Management and Performance from the Perspective of Fraud: A Comparative Study in Iraq, Iran, and Saudi Arabia," JRFM, MDPI, vol. 16(3), pages 1-27, March.
    7. OKEKE, Ijeoma Chinwe (Ph.D) & ALONTA, Gabriel Chidiebere, 2023. "Entrepreneurship Education And Informal Sector: Implications For Sustainable Economic Development," International Journal of Research and Scientific Innovation, International Journal of Research and Scientific Innovation (IJRSI), vol. 10(8), pages 297-305, August.
    8. García-Lillo, Francisco & Seva-Larrosa, Pedro & Sánchez-García, Eduardo, 2023. "What is going on in entrepreneurship research? A bibliometric and SNA analysis," Journal of Business Research, Elsevier, vol. 158(C).
    9. Rajeev K. Goel & Ummad Mazhar & Rati Ram, 2022. "Informal competition and firm performance: Impacts on input‐ versus output performance," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(2), pages 418-430, March.
    10. Saridakis, George & Georgellis, Yannis & Muñoz Torres, Rebeca I. & Mohammed, Anne-Marie & Blackburn, Robert, 2021. "From subsistence farming to agribusiness and nonfarm entrepreneurship: Does it improve economic conditions and well-being?," Journal of Business Research, Elsevier, vol. 136(C), pages 567-579.
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