Credit rationing, risk aversion, and industrial evolution in developing countries

• Autores: Eric W. Bond, James Tybout, Hale Utar
• Localización: International economic review, ISSN-e 1468-2354, Vol. 56, Nº. 3, 2015, págs. 695-722
• Idioma: inglés
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• Resumen

  • Relative to their counterparts in high-income regions, entrepreneurs in developing countries face less efficient financial markets, more volatile macroeconomic conditions, and higher entry costs. This article develops a dynamic empirical model that links these features of the business environment to cross-firm productivity distributions, entrepreneurs’ welfare, and patterns of industrial evolution. Fit to panel data on Colombian apparel producers, the model yields estimates of a credit market imperfection index, the sunk costs of creating a new business, and various technology parameters. Model-based counterfactual experiments suggest that improved intermediation could dramatically increase the return on assets for entrepreneurial households with modest wealth