Publication:
Does Inducing Informal Firms to Formalize Make Sense?: Experimental Evidence from Benin

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dc.contributor.authorBenhassine, Najy
dc.contributor.authorMcKenzie, David
dc.contributor.authorPouliquen, Victor
dc.contributor.authorSantini, Massimiliano
dc.date.accessioned2018-01-10T19:41:52Z
dc.date.available2018-01-10T19:41:52Z
dc.date.issued2018-01
dc.description.abstractEfforts to bring informal firms into the formal sector are often based on a view that this will bring benefits to the firms themselves, or at least benefit governments through increasing the tax base. A randomized experiment based around the introduction of the entreprenant legal status in Benin is used to test these assumptions, along with supplementary efforts to enhance the presumed benefits of formalizing to firms. Few firms register when just given information about the new regime, but our full package of supplementary efforts boosts formalization by 16.3 percentage points. However, this formalization does not bring firms higher sales or profits, and the cost of formalizing these firms exceeds the added taxation they will pay over the next decade. We show how better targeting of these policies towards firms that look more like formal firms to begin with can increase the formalization rate and improve cost-effectiveness.en
dc.identifier.citationJournal of Public Economics
dc.identifier.doi10.1596/29135
dc.identifier.issn0047-2727
dc.identifier.urihttps://hdl.handle.net/10986/29135
dc.publisherElsevier
dc.rightsCC BY-NC-ND 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.subjectINFORMALITY
dc.subjectSMALL ENTERPRISES
dc.subjectREGULATORY SIMPLIFICATION
dc.subjectSMALL AND MEDIUM ENTERPRISES
dc.subjectTAX BASE
dc.subjectTAXATION
dc.subjectADMINISTRATIVE COSTS
dc.titleDoes Inducing Informal Firms to Formalize Make Sense?en
dc.title.subtitleExperimental Evidence from Beninen
dc.typeJournal Articleen
dc.typeArticle de journalfr
dc.typeArtículo de revistaes
dspace.entity.typePublication
okr.associatedcontenthttp://www.sciencedirect.com/science/article/pii/S0047272717301883 Journal website (version of record)en
okr.associatedcontenthttps://openknowledge.worldbank.org/handle/10986/25704 Working paper version (pre-print)en
okr.crossref.titleDoes Inducing Informal Firms to Formalize Make Sense?: Experimental Evidence from Benin
okr.date.disclosure2019-11-21
okr.doctypePublications & Research::Journal Article
okr.doctypePublications & Research
okr.externalcontentExternal Content
okr.identifier.doi10.1016/j.jpubeco.2017.11.004
okr.identifier.doi10.1596/29135
okr.identifier.report123186
okr.journal.nbpages1-14
okr.language.supporteden
okr.peerreviewAcademic Peer Review
okr.region.administrativeAfrica
okr.region.countryBenin
okr.topicPublic Sector Development::Public Sector Administrative and Civil Service Reform
okr.topicLaw and Development::Administrative & Regulatory Law
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.topicPrivate Sector Development::Legal Regulation and Business Environment
okr.topicPrivate Sector Development::Small and Medium Size Enterprises
okr.unitFinance and Private Sector Development (DECFP)
okr.volume157
relation.isAuthorOfPublication148d6d6d-76e5-5d6f-9af9-98313e30551f
relation.isAuthorOfPublication.latestForDiscovery148d6d6d-76e5-5d6f-9af9-98313e30551f
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