The Role of Regulation on Entry: Evidence from the Italian Provinces

38 Pages Posted: 27 Apr 2016

Multiple version iconThere are 2 versions of this paper

Date Written: April 26, 2016

Abstract

This paper studies the effects of differences in local administrative burdens in Italy in the years 2005?2007 preceding a major reform that sped up firm registration procedures. Combining regulatory data from a survey on Italian provinces before the reform (costs and time to start a business) with industry-level entry rates of limited liability firms, it explores the effects of regulatory barriers on the average of the annual entry rates across industries with different natural propensities to enter the market. The estimates of the cross-sectional analysis show that lengthier and, to some extent, more costly procedures reduced entry in sectors with naturally high entry. A one-day delay in registration procedures reduces the entry rate in highly dynamic sectors by more than 1 percent. These results hold when I include measures of local financial development and of efficiency of bankruptcy procedures are included.

Keywords: Legislation, Social Policy, Regulatory Regimes, Legal Reform, Legal Products, Industrial Management, Judicial System Reform

Suggested Citation

Bripi, Francesco, The Role of Regulation on Entry: Evidence from the Italian Provinces (April 26, 2016). World Bank Policy Research Working Paper No. 7650, Available at SSRN: https://ssrn.com/abstract=2770861

Francesco Bripi (Contact Author)

Bank of Italy ( email )

P.zza Edison, 3
Milan, Milan 20123
Italy

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
43
Abstract Views
307
PlumX Metrics