Dynamics of pro-market institutions and firm performance

Banalieva, Elitsa R.; Cuervo-Cazurra, Álvaro; Sarathy, Ravi

doi:10.1057/s41267-018-0155-7

Cited by 85 publications

(106 citation statements)

References 99 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Likewise, we find that when rule of law is established in SSA countries, the firm’s performance improves significantly, and this is plausible as agents have greater confidence and belief in the strength of legal institution to pass and enforce fair and impartial judgements, especially on property rights, business contract franchises, etc. This finding supports Banalieva et al (2018) and Yasar et al (2011). Other important findings of the study are that capital–labour ratio, firm’s propensity to export, high school, R&D, capacity utilisation and average labour cost exert positive and significant impacts on the firm’s performance as against being sole proprietorship form of business, which significantly reduces the firm’s performance.…”

Section: Presentation and Discussion Of Resultssupporting

confidence: 78%

“…In literature, while it is established that older firms tend to have higher productivity than the younger ones, and large firms are also more productive, we also control for firm’s age and sizes. Also, as absorptive capacity of firms expands, the firms improve their adoption of technical and scientific ideas through research and development (R&D), knowledge spillover, learning-by-doing and collaboration over time (Banalieva et al, 2018). To this, we controlled for percentage of firms’ capacity utilisation and dummy for firms that ever spent on R&D.…”

Section: Methodology Of the Studymentioning

confidence: 99%

“…Unlike traditional (one-way) fixed-effect estimator, HDFE estimator can incorporate more than one fixed effect at once by absorbing or partialing them out without computing the time-varying fixed effect using dummies, which reduces degree of freedom. HDFE estimator is, therefore, more efficient as it absorbs multiple heterogeneity using Frisch–Waugh–Lovell theorem (Banalieva et al, 2018; Gormley & Matsa, 2016).…”

Section: Methodology Of the Studymentioning

confidence: 99%

“…Acemoglu and Johnson (2005) find that none of the specific legal obstacles (such as perceived quality, fairness and quickest of court cases) has a significant impact on the firm’s growth and performance. Likewise, Banalieva et al, (2018) discovered that intensifying pro-market institutional reforms and fading institutional reversal augment the firm’s performance.…”

Section: Literature Reviewmentioning

confidence: 99%

See 3 more Smart Citations

Do Institutions Promote Firm Performance? Evidence from Sub-Saharan Africa

Jibir

Abdu

Bello

et al. 2019

Review of Market Integration

View full text Add to dashboard Cite

This article examines the roles of institutions in driving firms’ performance using merged Enterprise Panel Survey data sets collected and compiled by World Bank for 23 sub-Saharan Africa (SSA). The study used labour productivity as a proxy of firms’ performance due to its advantages over total factor productivity. To address the problems of multiple sources of heterogeneity and simultaneity biases, the study employed high-dimensional fixed-effects model together with its instrumental variable version to estimate the impacts of institutions on firms’ performance in SSA. The study established that institutions contribute significantly and positively to firms’ performance in SSA. The study infers that control of corruption, government effectiveness, regulatory quality and rule of law are pro-market institutions that effectively create favourable business and investment climates. Other findings of the study include capital–labour ratio, export, high school, average labour costs, research and development (R&D) and capacity utilisation, which all drive the firm’s performance in SSA. Thus, the findings imply that prevailing and future policies on business, trade and investment in SSA should also incorporate institutional reforms as one of the essential measures to rapidly and sustainably boost economic performance in the region.

show abstract

Section: Presentation and Discussion Of Resultssupporting

confidence: 78%

Section: Methodology Of the Studymentioning

confidence: 99%

Section: Methodology Of the Studymentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 2 more Smart Citations

Do Institutions Promote Firm Performance? Evidence from Sub-Saharan Africa

Jibir

Abdu

Bello

et al. 2019

Review of Market Integration

View full text Add to dashboard Cite

show abstract

“…Foram analisados dados de 11.446 mil pequenos negócios de países latino-americanos, particularmente aquelas que responderam as questões relativas aos esforços de inovação do Enterprise Survey do Banco Mundial (2017). Vale explicar que os dados secundários considerados na pesquisa são do período de 2006 a 2017 e foram organizados em uma base de dados da seguinte forma: (a) para a variável independente, Dinâmicas institucionais, sendo divididas em reformas institucionais e reversões institucionais, onde adotamos o Grau de Mudança do Economic Freedom Index (Banalieva et al, 2018) e (b) para a variável dependente, Esforços de Inovação, adotamos os indicadores de investimento em P&D, de introdução de novos produtos e de introdução de novos processos do Enterprise Survey do Banco Mundial (2017), seguindo padrões do Manual de Oslo (2005).…”

Section: Introductionunclassified

Esforços De Inovação De Pequenos Negócios Na América Latina

Falaster

Rezende

2020

Anais Do XI EGEPE - Encontro De Estudos Sobre Empreendedorismo E Gestão De Pequenas Empresas

View full text Add to dashboard Cite

The consequences of short‐term institutional change in the rule of law for entrepreneurship

Mickiewicz

Stephan

Shami

2021

Global Strategy Journal

View full text Add to dashboard Cite

Research Summary Past research views institutions as stable and slow to change and uses institutional differences to explain cross‐national variation in entrepreneurship. This article introduces a new perspective to institutional theory, that of short‐term institutional change. Integrating insights from cognitive science allows us to theorize not just about the significance of short‐term institutional change but also about why and how deterioration versus improvements in institutions have distinct effects. We test how short‐term institutional change impacts entrepreneurship in a cross‐country multilevel study. We find that short‐term change in the rule of law affects entrepreneurial entry and that institutional deterioration weighs heavier than institutional improvement. We argue and find that changes in the rule of law are more consequential for entrepreneurship compared to changes in business regulations. Managerial Summary It is known that the quality of institutions affects individuals' decisions to pursue entrepreneurship. Yet, we newly investigate effects of year‐to‐year changes in national institutions. Not only changes in business regulations matter, but also changes in more fundamental institutional aspects, especially in the rule of law. We find that institutional change has an impact because, on its basis, potential entrepreneurs form expectations about the future and therefore about the riskiness of their investment. Deteriorations compared to improvements in the rule of law are more consequential for entrepreneurship, consistent with the fact that losses loom larger than gains in human decisions.

show abstract

Dynamics of pro-market institutions and firm performance

Cited by 85 publications

References 99 publications

Do Institutions Promote Firm Performance? Evidence from Sub-Saharan Africa

Do Institutions Promote Firm Performance? Evidence from Sub-Saharan Africa

Esforços De Inovação De Pequenos Negócios Na América Latina

The consequences of short‐term institutional change in the rule of law for entrepreneurship

Contact Info

Product

Resources

About