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Informal sector competition and firm productivity

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  • Arlette Beltrán

Abstract

We provide evidence on whether informal competition has a negative bearing on firm productivity in the formal sector. To do this we employ the World Bank’s Enterprise Survey (WBES) with detailed information for more than sixty thousand manufacturing and services formal firms from over 127 countries. We find a negative association between these two variables, which is further supported when using instrumental variables.

Suggested Citation

  • Arlette Beltrán, 2020. "Informal sector competition and firm productivity," Applied Economics Letters, Taylor & Francis Journals, vol. 27(15), pages 1243-1246, September.
    • Handle: RePEc:taf:apeclt:v:27:y:2020:i:15:p:1243-1246
    DOI: 10.1080/13504851.2019.1676383
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    Cited by:

    1. Wen, Huwei & Li, Nuoyan & Lee, Chien-Chiang, 2021. "Energy intensity of manufacturing enterprises under competitive pressure from the informal sector: Evidence from developing and emerging countries," Energy Economics, Elsevier, vol. 104(C).
    2. Mohammad Amin, 2023. "Does competition from informal firms hurt job creation by formal manufacturing SMEs in developing and emerging countries? Evidence using firm-level survey data," Small Business Economics, Springer, vol. 60(4), pages 1659-1681, April.
    3. 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.

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