Vargas, Jose P Mauricio (2012): Binding Constraints: Does Firm Size Matter?
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Using Bolivian firm level data from the World Bank 2010 Enterprise Survey, we attempt to find evidence to support the idea that distinct formal firms (according to their size) have a distinct likelihood of facing obstacles. We propose that a potential endogeneity between firms' constraints and firm size should be considered. After calculating estimations from an IV-ordered probit with an ordinal endogenous regressor, the results suggest that the firm size affects the constraint level reported by firms, but not for all kind of obstacles. `Corruption', `Political Instability', and `Crime, Theft and Disorder' are obstacles which affect all firms; `Electricity' and `Transportation' are binding constraints to medium and large firms; and `Access to Financing' is a binding constraint to small firms. These findings are important because they can be directly extrapolated to public policy that is focused on the performance of firms.
|Item Type:||MPRA Paper|
|Original Title:||Binding Constraints: Does Firm Size Matter?|
|English Title:||Binding Constraints: Does Firm Size Matter?|
|Keywords:||Firm, Size, Constraints, IV-oprobit|
|Subjects:||D - Microeconomics > D2 - Production and Organizations > D21 - Firm Behavior: Theory
L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L25 - Firm Performance: Size, Diversification, and Scope
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O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O12 - Microeconomic Analyses of Economic Development
|Depositing User:||José P Mauricio Vargas|
|Date Deposited:||13. Sep 2012 20:15|
|Last Modified:||22. Aug 2015 08:05|
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