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Comparing estimated and self-reported mark-ups for formal and informal firms in an emerging market context

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  • John Rand

Abstract

Using a 10-year panel survey covering Vietnamese manufacturing firms, we consistently obtain firm-specific mark-up estimates and relate these to firm-level formality. The average firm-specific mark-up using a trans-log revenue production function specification is estimated to be 1,445, with substantial underlying variation across firm size, location, sector, and ownership form. Zooming in on firm-level registration, we find a formality premium of 16 per cent, even when controlling for selection into formality.

Suggested Citation

  • John Rand, 2017. "Comparing estimated and self-reported mark-ups for formal and informal firms in an emerging market context," WIDER Working Paper Series wp-2017-160, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:wp-2017-160
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    References listed on IDEAS

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    Keywords

    Firm productivity; Formality; Viet Nam;

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