Legalizing Entrepreneurship

70 Pages Posted: 25 Jul 2022 Last revised: 20 Mar 2023

See all articles by Dany Bahar

Dany Bahar

Brown University - Watson Institute for International and Public Affairs; Harvard University - Center for International Development (CID)

Bo Cowgill

Columbia University - Columbia Business School

Jorge Guzman

Columbia University - Columbia Business School; NBER

Date Written: July 6, 2022

Abstract

We use administrative data linked to the complete formal business registry to study a 2018 policy shift in Colombia that made nearly half a million Venezuelan undocumented migrants eligible for a resident visa. Immigrants who receive the visa increase their economic activity in the form of higher entrepreneurship by a factor as high as 12, bringing it to parity with native Colombians four years later. To establish causal estimates, we develop a novel extension of a regression discontinuity design. Our design uses variation in the running-variable (coming from rain) to instrument for migrants' choices to apply for visas.

Keywords: immigration, entrepreneurship, Colombia, legalization

JEL Classification: L26, J61, K37

Suggested Citation

Bahar, Dany and Cowgill, Bo and Guzman, Jorge, Legalizing Entrepreneurship (July 6, 2022). Available at SSRN: https://ssrn.com/abstract=4155358 or http://dx.doi.org/10.2139/ssrn.4155358

Dany Bahar

Brown University - Watson Institute for International and Public Affairs ( email )

111 Thayer Street
Box 1970
Providence, RI 02912-1970
United States

Harvard University - Center for International Development (CID)

One Eliot Street Building
79 JFK Street
Cambridge, MA 02138
United States

Bo Cowgill

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

Jorge Guzman (Contact Author)

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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