Entry Regulation And Business Start-Ups : Evidence From Mexico / David S. Kaplan Kaplan, David S; Piedra, Eduardo; Seira, Enrique

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Kaplan, David S ; Piedra, Eduardo ; Seira, Enrique
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The Journal of Public Economics
Deregulation -- Laws, regulations and rules; Government regulation; Laws, regulations and rules
Academic; Trade
To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.jpubeco.2011.03.007 Byline: David S. Kaplan, Eduardo Piedra, Enrique Seira Keywords: Firm start-ups; Regulation; Informal sector; Program evaluation Abstract: We estimate the effect on business start-ups of a program that significantly speeds up firm registration procedures. The program was implemented in Mexico in different municipalities at different dates. Our estimates suggest that new start-ups increased by about 5% per month in eligible industries, and we present evidence supporting robustness and a causal effect interpretation. Most of the effect is temporary, concentrated in the first 15months after implementation. The estimated effect is much smaller than World Bank and Mexican authorities claim it is, which suggests attention in business deregulation may be over emphasized. Article History: Received 15 June 2007; Revised 1 March 2011; Accepted 29 March 2011 Article Note: (footnote) [star] We would like to thank Fernando Salas who made us aware of the existence of SARE. Jon Levin and Susan Athey have provided invaluable advice and comments throughout all of the research process. We have also benefited from discussions with Rodrigo Barros, Daniel Bautista, Gustavo Bello, Tim Bresnahan, Ariel Buira, Mierta Capaul, Giacomo DiGiorgi, Liran Einav, Pablo Fajnzylber, Carlos Garcia, Francisco Gil, Alvaro Gonzalez, Jose Antonio Gonzalez, Emeric Henry, Jesus Hurtado, Saumitra Jha, Laura Lombardi, Ernesto Lopez Cordoba, Bill Maloney, Caralee McLeish, Pedro Miranda, Sriniketh Nagavarapu, Alejandro Ponce, Rita Ramhalo, Aldo Sanchez, Alejandrina Salcedo, Siddharth Sharma, Rosa Maria Vega and Alejandro Werner. SIEPR at Stanford University provided financial support.
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