Labor productivity response of the micro-and-small-firm sector to business entries and exits
Abstract
This article investigates whether differences in business entry and exit rates explain differences in average, municipality-level labor productivity in the micro- and small-firm (MSF) sector. We focus on the case of Chile, exploiting an exogenous source of variation to exit rates-an exceptional event when the tax authority closed tens of thousands of ostensibly inactive firms in 2003-to instrument metrics of business dynamism in regression models of labor productivity. Pooled and panel instrumental variable (IV) estimations confirm that even the sector comprising the smallest firms in a less developed country can raise its productivity in the face of increased competition, knowledge inflows, and the release of resources.
Más información
Título según WOS: | Labor productivity response of the micro-and-small-firm sector to business entries and exits |
Título de la Revista: | JOURNAL OF SMALL BUSINESS MANAGEMENT |
Editorial: | TAYLOR & FRANCIS INC |
Fecha de publicación: | 2021 |
DOI: |
10.1080/00472778.2021.1934852 |
Notas: | ISI |