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The role of regulation on entry: evidence from the Italian provinces

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  • Francesco Bripi

    () (Bank of Italy)

Abstract

This paper studies the effects of differences in local administrative burdens in Italy in the years preceding a major reform that sped up firm registration procedures. Combining regulatory data from a survey on Italian provinces before the reform (costs and time to start a business) with industry-level entry rates of limited liability firms, I explore the effects of regulatory barriers on entry across industries with different natural propensities to enter the market. Using different specifications the estimates show that lengthier and, to some extent, more costly procedures reduced the entry rate of limited liability firms in sectors with naturally high entry rates. These results also hold when I include measures of local financial development and of efficiency of bankruptcy procedures. Overall, the analysis confirms the view that administrative burdens on new start-ups matter for business creation.

Suggested Citation

  • Francesco Bripi, 2013. "The role of regulation on entry: evidence from the Italian provinces," Temi di discussione (Economic working papers) 932, Bank of Italy, Economic Research and International Relations Area.
  • Handle: RePEc:bdi:wptemi:td_932_13
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    Cited by:

    1. Zuzana Brixiová & Balázs Égert, 2017. "Entrepreneurship, institutions and skills in low-income countries," SALDRU Working Papers 204, Southern Africa Labour and Development Research Unit, University of Cape Town.
    2. Monica Amici & Silvia Giacomelli & Francesco Manaresi & Marco Tonello, 2015. "Red tape reduction and firm entry: evidence from an Italian reform," Questioni di Economia e Finanza (Occasional Papers) 285, Bank of Italy, Economic Research and International Relations Area.
    3. repec:eee:ecmode:v:67:y:2017:i:c:p:381-391 is not listed on IDEAS
    4. Matteo Bugamelli & Francesca Lotti & Monica Amici & Emanuela Ciapanna & Fabrizio Colonna & Francesco D’Amuri & Silvia Giacomelli & Andrea Linarello & Francesco Manaresi & Giuliana Palumbo & Filippo Sc, 2018. "Productivity growth in Italy: a tale of a slow-motion change," Questioni di Economia e Finanza (Occasional Papers) 422, Bank of Italy, Economic Research and International Relations Area.

    More about this item

    Keywords

    entry regulation; entrepreneurship; doing business;

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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