Informality is pervasive in developing countries. In Bangladesh, the majority of firms are informal and as such they might not have access to prime markets, while lowering the tax base. The authors implemented an information campaign on registration, including both the step-by-step procedures and the potential benefits from registration. They find that the treatment made firms more aware of the procedures, but had no impact on actual registration. The results point toward potentially low benefits and high indirect costs of registration as the main barriers to formality (e.g. access to markets, taxation, labor and product regulations).
Details
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Author
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Document Date
2013/03/01
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Document Type
Policy Research Working Paper
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Report Number
WPS6382
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Volume No
1
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Total Volume(s)
1
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Country
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Region
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Disclosure Date
2013/03/01
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Disclosure Status
Disclosed
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Doc Name
SME registration evidence from a randomized controlled trial in Bangladesh
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Keywords
registration process;registration procedure;information campaign;small and medium enterprise;Business Registration;propensity score matching;information and communication technology;share of tax revenue;propensity score matching method;investment climate;standard error;sole proprietorship;marginal effect;fixed effect;expected present value;parameter of interest;comparison of cost;payment of fee;discounted present value;availability of information;international good practice;tax authority;tax authorities;registration fee;long-term contract;fraudulent behavior;linear probability;credit market;legal authority;district town;tax registration;modest increase;institutional context;hidden cost;formal contracts;business performance;assignment mechanism;human capital;production function;missing value;standard variables;public economics;business start-ups;binding constraint;high tax;information constraint;registration system;entry regulation;development policy;payment process;information cost;empirical issue;stamp duty;business process;registered business;stamp price;research assistance;government revenue;empirical analysis;open access;product regulation;baseline information;tax base;evaluation study;positive outcome;tax burden;causal relationship;conceptual framework;bank network;representative survey;social status;ownership right;greater access;treatment group;online system;
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Citation
De Giorgi,Giacomo Rahman,Aminur
SME registration evidence from a randomized controlled trial in Bangladesh (English). Impact Evaluation series ; no. IE 86,Policy Research working paper ; no. WPS 6382 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/476581468212374440/SME-registration-evidence-from-a-randomized-controlled-trial-in-Bangladesh