Business Law, Public Responsibility, and Ethics | Open Access Articles

To advance understanding of informal sector entrepreneurship, the aim of this

paper is to evaluate and explain the cross-country variations in the prevalence of informal

sector competitors. To do so, World Bank Enterprise Survey (WBES) data is reported

from 142 countries. This reveals that 27% of formal enterprises view competition from the

informal sector as a major constraint on their operations, although this varies from 72%of

formal enterprises in Chad to no formal enterprises in El Salvador. To explain these crosscountry

variations, four competing theories are evaluated which variously view informal

sector entrepreneurship and enterprise to bemore prevalent when there …

Recent years have seen a questioning of the negative representation of

informal sector entrepreneurship and an emergent view that it may offer significant

benefits. This paper advances this rethinking by evaluating the relationship between

business registration and future firm performance. Until now, the assumption has been

that starting-up unregistered is linked to weaker firm performance. Using World Bank

Enterprise Survey data on 2494 formal enterprises in Turkey, and controlling for other

determinants of firm performance as well as the endogeneity of the registration

decision, the finding is that formal enterprises that started-up unregistered and spent

longer unregistered have significantly higher …

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