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Regional determinants of firm entry in a developing country

  • Calá, Carla Daniela
  • Manjón Antolín, Miguel C.
  • Arauzo Carod, Josep Maria

We analyse the determinants of firm entry in developing countries using Argentina as an illustrative case. Our main finding is that although most of the regional determinants used in previous studies analysing developed countries are also relevant here, there is a need for additional explanatory variables that proxy for the specificities of developing economies (e.g., poverty, informal economy and idle capacity).We also find evidence of a core-periphery pattern in the spatial structure of entry that seems to be mostly driven by differences in agglomeration economies. Since regional policies aiming to attract new firms are largely based on evidence from developed countries, our results raise doubts about the usefulness of such policies when applied to developing economies. JEL classification: R12, R30, C33. Key words: Firm entry, Argentina, count data models.

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Paper provided by Universitat Rovira i Virgili, Department of Economics in its series Working Papers with number 2072/238220.

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Date of creation: 2014
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Handle: RePEc:urv:wpaper:2072/238220
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