Product Market Regulation and Macroeconomic Performance : A Review of Cross-Country Evidence

The main purpose of this paper is to provide a critical overview of the recent empirical contributions that use cross-country data to study the effects of product market regulation and reform on a country's macroeconomic performance. After a brief review of the theoretical literature and of rel...

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Bibliographic Details
Main Author:	Schiantarelli, Fabio
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ADJUSTMENT COSTS ADVERSE EFFECTS AGENCY PROBLEMS AGGREGATE OUTPUT AGGREGATE PERFORMANCE AGGREGATE PRODUCTIVITY GROWTH AVERAGE PRODUCTIVITY AVERAGE PRODUCTIVITY GROWTH BANKRUPTCY BARGAINING POWER BARRIERS TO ENTRY CAPITAL ACCUMULATION CAPITAL COSTS COMPETITIVE ENVIRONMENT COMPETITIVE MARKETS COMPETITIVE PRESSURE CONSUMERS COUNTRY LEVEL CREATIVE DESTRUCTION CROSS-COUNTRY DATA DATA SET DATA SETS DEMAND ELASTICITY DEPENDENT VARIABLE DEREGULATION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DOWNWARD BIAS DYNAMIC PANEL ECONOMIC ACTIVITY ECONOMIC OUTCOMES ECONOMIC OUTLOOK ELASTICITY EMPIRICAL EVIDENCE EMPIRICAL LITERATURE EMPIRICAL RESEARCH EMPIRICAL RESULTS EMPIRICAL WORK ENDOGENOUS GROWTH ENDOGENOUS GROWTH MODEL ENTRY BARRIERS ENTRY COST ENTRY COSTS ENTRY RATE EQUILIBRIUM PRICES EXPLANATORY POWER EXPLANATORY VARIABLE FACTOR DEMAND FACTOR MARKETS FINANCIAL SECTOR FIRM DEMOGRAPHIC FIRM DYNAMICS FIRM LEVEL FIRM SIZE FIRM TURNOVER FOREIGN COMPETITION GDP GDP PER CAPITA GROWTH MODELS GROWTH RATE GROWTH RATES HIGH UNEMPLOYMENT IMPORT BARRIERS INCOME INCREASING RETURNS INCREASING SHARE INDIVIDUAL COUNTRIES INDUSTRIAL ECONOMIES INEFFICIENCY INFLATION LABOR DEMAND LABOR MARKET LABOR MARKET REFORM LABOR MARKET REGULATION LABOR MARKET REGULATIONS LABOR MARKETS LABOR PRODUCTIVITY LONG-RUN EFFECTS MACROECONOMIC PERFORMANCE MANAGERIAL SLACK MARGINAL COSTS MARKET MARKET POWER MARKET SHARE MARKET STRUCTURE MEASUREMENT ERROR MINIMUM LEVEL MONOPOLY RENTS NATURAL MONOPOLIES NEGATIVE EFFECT NEGATIVE IMPACT PATENTS POLICY IMPLICATIONS POLICY RESEARCH POOR COUNTRIES POOR GROWTH POSITIVE EFFECT POSITIVE RELATIONSHIP PRICE CONTROLS PRICE ELASTICITY PRICE ELASTICITY OF DEMAND PRIVATIZATION PROCESS INNOVATIONS PRODUCT MARKET PRODUCT MARKET REFORM PRODUCT MARKET REFORMS PRODUCT MARKET REGULATION PRODUCTION COSTS PRODUCTION FUNCTION PRODUCTIVE EFFICIENCY PRODUCTIVE FIRMS PRODUCTIVITY PRODUCTIVITY GAINS PRODUCTIVITY GROWTH PRODUCTIVITY IMPROVEMENT PRODUCTIVITY LEVELS PUBLIC ENTERPRISES REAL WAGE REAL WAGES REFORMS REGULATORY CHANGES REGULATORY DATA REGULATORY ENVIRONMENT REGULATORY FRAMEWORK REGULATORY REFORMS RELATIVE IMPORTANCE RESOURCE ALLOCATION RETAIL RETAIL TRADE SCALE EFFECT SCALE EFFECTS SERVICE SECTOR SIGNIFICANT EFFECT TARIFF BARRIERS TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TOTAL PRODUCTIVITY GROWTH TRADE BARRIERS TRADE LIBERALIZATION TRANSITION ECONOMIES TRANSPORT SECTOR UNEMPLOYMENT UTILITIES VALUE ADDED VERTICAL INTEGRATION VOLATILITY WAGES WORKERS
Online Access:	http://documents.worldbank.org/curated/en/2005/11/6413121/product-market-regulation-macroeconomic-performance-review-cross-country-evidence-product-market-regulation-macroeconomic-performance-review-cross-country-evidence http://hdl.handle.net/10986/8567

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Summary:	The main purpose of this paper is to provide a critical overview of the recent empirical contributions that use cross-country data to study the effects of product market regulation and reform on a country's macroeconomic performance. After a brief review of the theoretical literature and of relevant micro-econometric evidence, the paper discusses the main data and methodological issues related to empirical work on this topic. It then critically evaluates the cross-country evidence on the effects of product market regulation on mark-ups, firm dynamics, investment, employment, innovation, productivity, and output growth. The paper concludes with a summary of lessons learned from the econometric results.

Product Market Regulation and Macroeconomic Performance : A Review of Cross-Country Evidence

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