A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico
Different views have been put forward to explain why most firms in developing countries operate informally. One view argues that informal-business owners are entrepreneurs who do not register their firm because the regulation process is too complex...
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| Format: | Policy Research Working Paper |
| Language: | English |
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2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120221112635 http://hdl.handle.net/10986/3257 |
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okr-10986-32572021-04-23T14:02:08Z A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico Bruhn, Miriam BEST PRACTICES BUSINESS ECONOMICS BUSINESS OPPORTUNITY BUSINESS OWNER BUSINESS OWNERS BUSINESS REGISTRATION BUSINESS STARTUPS BUSINESSES CHARACTERISTICS OF BUSINESS OWNERS COMPLIANCE COSTS CREDIT MARKET ECONOMIC DEVELOPMENT ECONOMIC GROWTH EDUCATION LEVEL EMPLOYERS EMPLOYMENT STATUS ENTERPRISE SURVEY ENTREPRENEURIAL ACTIVITY ENTREPRENEURS EXCLUSION FEDERAL AGENCY FIXED ASSETS GENDER GOVERNMENT CONTRACTS HEAD OF HOUSEHOLD HOUSEHOLDS ICT IMPACT ANALYSIS INSTITUTION INTERNATIONAL BANK INTERNATIONAL FINANCE JOB CREATION JOB OPPORTUNITIES LABOR MARKET LABOR MARKETS LABOUR MARKETS LICENSE MANUFACTURING OPEN ACCESS PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRODUCTIVITY PROFITABILITY RECEIPTS RESULT RESULTS SAFETY NET SEARCH SELF EMPLOYMENT SELF-HELP SMALL BUSINESS SOCIAL SECURITY STARTUPS TECHNICAL ASSISTANCE UNEMPLOYMENT USES WEB Different views have been put forward to explain why most firms in developing countries operate informally. One view argues that informal-business owners are entrepreneurs who do not register their firm because the regulation process is too complex. Another argues that informal-business owners are people trying to make a living while searching for a wage job. This paper contributes to recent literature that argues that both factors are at work. The author uses discriminant analysis to separate informal business owners into two groups: those with personal characteristics similar to wage workers, and those with traits similar to formal-business owners. The paper then examines how the two groups were affected by a business registration reform in Mexico. Informal-business owners from the second group were more likely to register their business after the reform. By contrast, informal-business owners from the first group were less likely to register but more likely to become wage workers after the reform. This is consistent with the finding in Bruhn (2008 and 2011) that the reform led to job creation. It also explains why the earlier papers find that the reform didn t affect the number of new registrations by all informal business owners. 2012-03-19T17:29:15Z 2012-03-19T17:29:15Z 2012-02-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120221112635 http://hdl.handle.net/10986/3257 English Policy Research working paper ; no. WPS 5971 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper Latin America & Caribbean Latin America & Caribbean North America America Mexico |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
BEST PRACTICES BUSINESS ECONOMICS BUSINESS OPPORTUNITY BUSINESS OWNER BUSINESS OWNERS BUSINESS REGISTRATION BUSINESS STARTUPS BUSINESSES CHARACTERISTICS OF BUSINESS OWNERS COMPLIANCE COSTS CREDIT MARKET ECONOMIC DEVELOPMENT ECONOMIC GROWTH EDUCATION LEVEL EMPLOYERS EMPLOYMENT STATUS ENTERPRISE SURVEY ENTREPRENEURIAL ACTIVITY ENTREPRENEURS EXCLUSION FEDERAL AGENCY FIXED ASSETS GENDER GOVERNMENT CONTRACTS HEAD OF HOUSEHOLD HOUSEHOLDS ICT IMPACT ANALYSIS INSTITUTION INTERNATIONAL BANK INTERNATIONAL FINANCE JOB CREATION JOB OPPORTUNITIES LABOR MARKET LABOR MARKETS LABOUR MARKETS LICENSE MANUFACTURING OPEN ACCESS PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRODUCTIVITY PROFITABILITY RECEIPTS RESULT RESULTS SAFETY NET SEARCH SELF EMPLOYMENT SELF-HELP SMALL BUSINESS SOCIAL SECURITY STARTUPS TECHNICAL ASSISTANCE UNEMPLOYMENT USES WEB |
| spellingShingle |
BEST PRACTICES BUSINESS ECONOMICS BUSINESS OPPORTUNITY BUSINESS OWNER BUSINESS OWNERS BUSINESS REGISTRATION BUSINESS STARTUPS BUSINESSES CHARACTERISTICS OF BUSINESS OWNERS COMPLIANCE COSTS CREDIT MARKET ECONOMIC DEVELOPMENT ECONOMIC GROWTH EDUCATION LEVEL EMPLOYERS EMPLOYMENT STATUS ENTERPRISE SURVEY ENTREPRENEURIAL ACTIVITY ENTREPRENEURS EXCLUSION FEDERAL AGENCY FIXED ASSETS GENDER GOVERNMENT CONTRACTS HEAD OF HOUSEHOLD HOUSEHOLDS ICT IMPACT ANALYSIS INSTITUTION INTERNATIONAL BANK INTERNATIONAL FINANCE JOB CREATION JOB OPPORTUNITIES LABOR MARKET LABOR MARKETS LABOUR MARKETS LICENSE MANUFACTURING OPEN ACCESS PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRODUCTIVITY PROFITABILITY RECEIPTS RESULT RESULTS SAFETY NET SEARCH SELF EMPLOYMENT SELF-HELP SMALL BUSINESS SOCIAL SECURITY STARTUPS TECHNICAL ASSISTANCE UNEMPLOYMENT USES WEB Bruhn, Miriam A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| geographic_facet |
Latin America & Caribbean Latin America & Caribbean North America America Mexico |
| relation |
Policy Research working paper ; no. WPS 5971 |
| description |
Different views have been put forward to
explain why most firms in developing countries operate
informally. One view argues that informal-business owners
are entrepreneurs who do not register their firm because the
regulation process is too complex. Another argues that
informal-business owners are people trying to make a living
while searching for a wage job. This paper contributes to
recent literature that argues that both factors are at work.
The author uses discriminant analysis to separate informal
business owners into two groups: those with personal
characteristics similar to wage workers, and those with
traits similar to formal-business owners. The paper then
examines how the two groups were affected by a business
registration reform in Mexico. Informal-business owners from
the second group were more likely to register their business
after the reform. By contrast, informal-business owners from
the first group were less likely to register but more likely
to become wage workers after the reform. This is consistent
with the finding in Bruhn (2008 and 2011) that the reform
led to job creation. It also explains why the earlier papers
find that the reform didn t affect the number of new
registrations by all informal business owners. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Bruhn, Miriam |
| author_facet |
Bruhn, Miriam |
| author_sort |
Bruhn, Miriam |
| title |
A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| title_short |
A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| title_full |
A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| title_fullStr |
A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| title_full_unstemmed |
A Tale of Two Species : Revisiting the Effect of Registration Reform on Informal Business Owners in Mexico |
| title_sort |
tale of two species : revisiting the effect of registration reform on informal business owners in mexico |
| publishDate |
2012 |
| url |
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120221112635 http://hdl.handle.net/10986/3257 |
| _version_ |
1764386688583335936 |