scholarly journals BUSINESS REGISTRATION AND FIRM PERFORMANCE: SOME LESSONS FROM INDIA

2016 ◽  
Vol 21 (03) ◽  
pp. 1650016 ◽  
Author(s):  
COLIN C WILLIAMS ◽  
ABBI M. KEDIR
Keyword(s):  
Firm Performance ◽  
World Bank ◽  
Institutional Environment ◽  
Policy Implications ◽  
Performance Reporting ◽  
Start Up ◽  
Tentative Explanation ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
Productivity Gains

The aim of this paper is to evaluate the impacts on future firm performance of a firm deciding to register from the outset of its operations. Until now, the assumption has been that starting up registered is linked to higher future firm performance. Reporting World Bank Enterprise Survey (WBES) data collected in 2014 on 9,281 formal enterprises in India, and controlling for other determinants of firm performance as well as the endogeneity of the registration decision, the finding is that formal enterprises that start up unregistered and spend longer unregistered have significantly higher subsequent annual sales and employment growth rates compared with those registered from the outset. When the number of years spent unregistered is included, there are also productivity gains from delaying registration. The tentative explanation is that in this weak institutional environment, the advantages of registering from the outset are outweighed by the benefits of deferring registration. Evaluating the policy implications, the argument is that there is a need to shift away from the conventional eradication approach toward unregistered startups based on the assumption they are unproductive, and toward a more facilitating approach that improves the benefits of being registered and tackles the systemic formal institutional deficiencies that lead entrepreneurs to delay their decision to register.

EVALUATING THE IMPACTS OF STARTING UP UNREGISTERED ON FIRM PERFORMANCE IN AFRICA

2017 ◽  
Vol 22 (03) ◽  
pp. 1750017 ◽  
Author(s):  
COLIN C. WILLIAMS ◽  
ABBI M. KEDIR
Keyword(s):  
Firm Performance ◽  
World Bank ◽  
Productivity Growth ◽  
Informal Economy ◽  
Poor Performance ◽  
Policy Implications ◽  
African Countries ◽  
Formal Economy ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey

The aim of this paper is to contribute to an understanding of the entrepreneurship process in Africa by evaluating the link between starting up unregistered and future firm performance. The widespread assumption has been that firms starting up unregistered in the informal economy suffer from poor performance compared to those starting up registered and in the formal economy. To test this poorer performance thesis, World Bank Enterprise Survey (WBES) data is evaluated from across 41 African countries covering the period from 2006 to 2013. Controlling for a comprehensive set of other determinants of firm performance, the finding is that formal enterprises with five or more employees that started up unregistered have significantly higher annual sales, employment and productivity growth rates compared with those firms that registered their operations at startup. The paper concludes by discussing the theoretical and policy implications of this finding.

Informal Entrepreneurship in Developing Economies: The Impacts of Starting up Unregistered on firm Performance

2017 ◽  
Vol 41 (5) ◽  
pp. 773-799 ◽  
Author(s):  
Colin C. Williams ◽  
Alvaro Martinez–Perez ◽  
Abbi M. Kedir
Keyword(s):  
Firm Performance ◽  
World Bank ◽  
Developing Economies ◽  
Policy Implications ◽  
Subsequent Growth ◽  
Informal Entrepreneurship ◽  
Performance Determinants ◽  
The Cost ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey

To advance understanding of the entrepreneurship process in developing economies, this article evaluates whether registered enterprises that initially avoid the cost of registration, and focus their resources on overcoming other liabilities of newness, lay a stronger foundation for subsequent growth. Analyzing World Bank Enterprise Survey data across 127 countries, and controlling for other firm performance determinants, registered enterprises that started up unregistered and spent longer operating unregistered are revealed to have significantly higher subsequent annual sales, employment, and productivity growth rates compared with those that registered from the outset. The theoretical and policy implications are then discussed.

scholarly journals EVALUATING THE IMPACT OF INFORMAL SECTOR COMPETITORS ON THE PERFORMANCE OF FORMAL ENTERPRISES: EVIDENCE FROM BOSNIA AND HERZEGOVINA

2020 ◽  
Vol 25 (02) ◽  
pp. 2050014
Author(s):  
COLIN C. WILLIAMS ◽  
BRUNILDA KOSTA
Keyword(s):  
World Bank ◽  
Bosnia And Herzegovina ◽  
Informal Sector ◽  
Employment Growth ◽  
Policy Implications ◽  
Sales Growth ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
The Impact ◽  
Do So

It is widely assumed that informal sector enterprises have a harmful impact on the performance of formal enterprises. This paper aims to provide an evidence-based evaluation of whether this is the case. To do so, it reports World Bank Enterprise Survey (WBES) data collected from 360 formal enterprises in Bosnia and Herzegovina in 2019. The finding is that formal enterprises viewing informal competition as a severe obstacle do not witness significantly lower sales growth, employment growth or productivity growth. Indeed, such enterprises witness significantly higher sales growth than those who do not view informal sector competitors as a severe obstacle. The theoretical and policy implications are discussed.

scholarly journals EVALUATING THE EFFECTS OF THE INFORMAL SECTOR ON THE GROWTH OF FORMAL SECTOR ENTERPRISES: LESSONS FROM ITALY

2020 ◽  
Vol 25 (03) ◽  
pp. 2050019
Author(s):  
BRUNILDA KOSTA ◽  
COLIN C WILLIAMS
Keyword(s):  
World Bank ◽  
Informal Sector ◽  
Productivity Growth ◽  
Policy Implications ◽  
Future Research ◽  
Sales Growth ◽  
Formal Sector ◽  
Annual Productivity ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey

This paper evaluates the effect of unregistered and informal sector business ventures on the growth of formal sector enterprises. The hypotheses tested is that formal sector enterprises that have to compete against unregistered or informal sector business ventures suffer from lower levels of performance, measured by annual sales growth, annual employment growth and annual productivity growth. To evaluate this thesis, data is reported from a World Bank Enterprise Survey (WBES) of 760 enterprises in Italy collected in 2019. The finding is that formal sector enterprises that report competing against unregistered or informal sector business ventures have significantly lower annual sales growth and annual productivity growth than enterprises that do not. The paper concludes by discussing the theoretical and policy implications, along with the limitations of the study and future research required.

scholarly journals EVALUATING THE IMPLICATIONS OF STARTING-UP UNREGISTERED ON FUTURE FIRM PERFORMANCE: EVIDENCE A 2019 SURVEY IN ALBANIA

2020 ◽  
Vol 25 (02) ◽  
pp. 2050010
Author(s):  
COLIN C. WILLIAMS ◽  
BRUNILDA KOSTA
Keyword(s):  
Firm Performance ◽  
World Bank ◽  
Informal Sector ◽  
Sales Growth ◽  
Widespread Belief ◽  
Informal Entrepreneurship ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
Start Ups ◽  
The Relationship

This paper evaluates critically the relationship between starting-up unregistered and firm performance. The widespread belief across all the dominant theories of informal entrepreneurship is that unregistered start-ups experience poorer future firm performance than those registered from the outset of their operations. To evaluate this poorer performance thesis, this paper reports World Bank Enterprise Survey (WBES) data on 377 enterprises in Albania collected in 2019. After controlling for other determinants of firm performance, the finding is that formal enterprises that started-up unregistered have significantly higher annual sales growth than enterprises that registered from the outset. To explain this, the argument is that in weak institutional environments, such as Albania, the advantages of operating unregistered at the outset outweigh the benefits of registration. The result is a call to re-theorize firm performance in the informal sector and for policy to shift toward a more facilitating approach that enhances benefits of registration.

scholarly journals Evaluating the Impact of the Informal Economy on Businesses in South East Europe: Some Lessons from the 2009 World Bank Enterprise Survey

2012 ◽  
Vol 7 (1) ◽  
pp. 99-110 ◽  
Author(s):  
John Hudson ◽  
Colin Williams ◽  
Marta Orviska ◽  
Sara Nadin
Keyword(s):  
World Bank ◽  
Informal Economy ◽  
Employment Relations ◽  
East Europe ◽  
South East Europe ◽  
Adverse Impacts ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
The Impact ◽  
Targeted Approach

Evaluating the Impact of the Informal Economy on Businesses in South East Europe: Some Lessons from the 2009 World Bank Enterprise SurveyThe aim of this paper is to evaluate the variable impacts of the informal economy on businesses and employment relations in South East Europe. Evidence is reported from the 2009 World Bank Enterprise Survey which interviewed 4,720 businesses located in South East Europe. The finding is not only that a large informal sector reduces wage levels but also that there are significant spatial variations in the adverse impacts of the informal economy across this European region. Small, rural and domestic businesses producing for the home market and the transport, construction, garment and wholesale sectors are most likely to be adversely affected by the informal economy. The paper concludes by calling for similar research in other global regions and for a more targeted approach towards tackling the informal economy.

Major obstacles facing business enterprises in an emerging economy: the case of Ghana using the World Bank Enterprise Survey

2021 ◽  
Vol 28 (3) ◽  
pp. 475-487
Author(s):  
Ibrahim Mohammed ◽  
Alhassan Bunyaminu
Keyword(s):  
World Bank ◽  
Emerging Economy ◽  
Probit Regression ◽  
Cross Sectional ◽  
Content Type ◽  
The World Bank ◽  
The World ◽  
Business Enterprises ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey

PurposeThis paper aims at identifying the major obstacles to business enterprise in an emerging economy and how these obstacles are associated with different characteristics of the enterprises.Design/methodology/approachThe study relied on the World Bank Enterprise Survey data on Ghana and applied binary and ordinal probit regression techniques to estimate the associations between the characteristics of the enterprises and the identified obstacles. Significance testing of the associations is also conducted.FindingsThe five main obstacles perceived by most of the enterprises in the study are access to finance, electricity, access to land, customs and trade regulations and tax rates. These obstacles are associated in different ways to growth rate (high vs low growth), scale (small and medium vs large), age, size of employees, the experience of the top manager and ownership (wholly domestic vs foreign ownership).Research limitations/implicationsAs a cross-sectional study focusing on Ghana, the findings are informative about the major obstacles facing business enterprises in an emerging economy; however, the ecological validity of these findings may be limited to factors specific to Ghana.Originality/valueGiven the representativeness of the Enterprise Survey, policymakers can rely on these findings to formulate useful policies to promote the operations of business enterprises.

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