Mohammad Amin

Gender Disparity in Laws and Female Employment

Mohammad Amin — Fri, 20 Jan 2012 06:47:24 PST

In a large sample of firms in 66 developing countries, it is shown that gender specific disparity in the laws favoring males over females tends to lower the employment of females relative to males at the firm level. However, this relationship between gender disparity in laws and employment is driven by small and medium firms, and it does not hold for the sample of large firms. However, the relationship holds equally in rich vs. poor countries, small vs. large cities within countries and among firms with and without female owners. We also confirm a sharp negative effect of gender disparity in the laws on the absolute level of employment of females. In short, in the presence of gender disparity in the laws, suitable reforms or policy measures promoting female employment may be required to achieve greater employment of women and greater gender parity in employment.

Is There More Corruption in Larger Countries? Evidence Using Firm-level Data

Mohammad Amin — Tue, 28 Jun 2011 12:42:35 PDT

Existing studies show that the impact of country size on the level of corruption is sensitive to the dataset used and the sample of countries under study. The present paper contributes to the literature on country size and corruption by using newly available firm-level data on firm’s experience with corruption in 25 countries in Eastern Europe and Central Asia. Our results show that the level of corruption rises sharply with country size as measured by the total population of a country. Contrary to claims in the literature, we find no evidence that the corruption and country size relationship is stronger for smaller compared with larger countries. We use a large number of controls and the instrumental variables regression method to confirm all our results against possible endogeneity concerns.

Does Country Size Matter for Tax Rates?

Mohammad Amin — Mon, 20 Jun 2011 14:04:54 PDT

Repeated attempts at uncovering the impact of country size on various socio-economic factors have shown that country size doesn’t matter except for trade openness. The present paper takes another look at the relevance of country size. Using newly available macro as well as firm-level micro data on tax rates, the paper finds tax rates are more burdensome in the relatively larger countries. The finding is robust to a large number of controls, alternative specifications and estimation methods including the instrumental variables regression method. Further, we find some evidence suggesting that the strength of the relationship between tax rates and country size varies with the level of income of the country. It is possible that the failure to account for such non-linearity could be one reason why previous studies have failed to find any robust impact of country size on various socio-economic variables.

Education and the Structure of Informal Firms in Latin America (Short Note)

Mohammad Amin — Fri, 03 Jun 2011 10:23:23 PDT

A recent survey of unregistered or informal firms in Argentina and Peru shows that about 74 percent of the owners have at least secondary or higher education. This note compares firms by the education level of the owners to assess how education affects the structure, conduct and performance of informal firms. The results show a limited impact of education. Firm-efficiency as measured by sales per worker rises sharply with the level of education of the owner and the same holds for firm-size as measured by monthly sales or employment. Firms with relatively more educated owners are more likely to use external sources of finance, cell phones and in some cases show greater inclination to register, work on contract basis and maintain business accounts separate from household accounts. However, in other dimensions—such as the use of machinery and vehicles—there is no significant difference between firms by the education level of the owner of the firm.

Does Country Size Matter? (Short Note)

Mohammad Amin — Fri, 03 Jun 2011 08:02:01 PDT

With the exception of trade openness, existing studies have failed to find any significant impact of country size on various social and economic variables. This note uses newly available firm-level and country-level data and shows that country size does matter with small countries performing better than large countries in areas such as trade facilitation, tax administration, burden of tax rates on private firms and corruption. The note also argues that the impact of country size on a variable of interest may not be uniform and it may depend on for example, how large the country is to begin with and its income level.

Quality of Tax Administration: How Relevant is Country Size?

Mohammad Amin — Wed, 01 Jun 2011 17:48:44 PDT

Repeated attempts at uncovering the relevance of country size for various economic factors have produced discouraging results. The present paper sheds new light on the relevance of country size using micro or firm-level data on firms’ experience with the quality of tax administration, an important but neglected element of the business climate. We find that the quality of tax administration is significantly better for small compared with large countries. Instrumental variables regression method confirms that our finding is robust to various endogeneity concerns. We also find some evidence that the country size and tax administration relationship is non-linear, much stronger for small than large countries. Implications of our findings for the broader literature on country size are discussed.

The Time Cost of Documents to Trade

Mohammad Amin — Tue, 17 May 2011 13:16:18 PDT

The paper shows that the number of documents required to export and import tend to increase the time cost of shipments. However, this relationship is far from simplistic, varying sharply in magnitude across rich vs. poor countries and small vs. large countries. Specifically, the increase in the time cost of increased documentation is much larger for the relatively poor and larger countries. One interpretation of this finding is that the richer countries that have more resources and the smaller countries that rely more on trade invest more in building efficient documentation systems. Hence, in such countries relative to others, increased documentation adds less to the time cost at the margin. At a broader level, our findings suggest caution in interpreting how input-based measures such as the number of required documents to trade affect the quality of the business environment as far as the associated cost is concerned.

Trade Facilitation and Country Size

Mohammad Amin et al. — Tue, 17 May 2011 08:45:03 PDT

It is argued that compared with large countries, small countries rely more on trade and therefore they are more likely to adopt liberal trading policies. The present paper extends this idea beyond the conventional trade openness measures by analyzing the relationship between country size and the number of documents required to export and import, a measure of trade facilitation. Three important results follow. First, trade facilitation does improve as the country size becomes smaller; that is, small countries perform better than large countries in terms of trade facilitation. Second, the relationship between country size and trade facilitation is non-linear, much stronger for the relatively small than the large countries. Third, contrary to what the existing studies might suggest, the relationship between country size and trade facilitation does not appear to be driven by the fact that small countries trade more as a proportion of their GDP than the large countries.

Labor Productivity, Firm-size and Gender: The Case of Informal Firms in Latin America (Short Note)

Mohammad Amin — Thu, 17 Mar 2011 08:24:52 PDT

A commonly held view is that female-owned businesses suffer from many disadvantages compared to male-owned businesses. These disadvantages lead in turn to relatively lower levels of efficiency and smaller firm-size among female-owned businesses—the female-owned firms under-performance hypothesis. Using data on unregistered firms in Argentina and Peru, the female-owned firms’ under-performance hypothesis is confirmed. The gender based difference in efficiency and firm-size holds within the full sample and no more than 25 percent to 30 percent of the difference can be explained by variations in firm characteristics. The gender based gap in performance also holds within various sub-samples, although the magnitude of the difference does vary across the sub-groups— such as Argentina vs. Peru, firms located inside vs. outside household premises and firm management with high vs. low education levels.

The Cost of Registering Property: Does Legal Origin Matter?

Mohammad Amin et al. — Wed, 09 Mar 2011 09:17:44 PST

There is a large literature that finds that common law countries perform better than civil law countries in various aspects of the institutional environment. The present paper extends these findings to another dimension of institutional quality - the cost of registering property. In a sample of 121 countries, we find that the cost of registering property is lower by 26 percent of the world average in common law compared with civil law countries, a result largely driven by differences in non-notary costs of registering property. We provide plausible explanations for these findings.

Gender and Informality in Latin America (Short Note)

Mohammad Amin — Thu, 10 Feb 2011 13:42:51 PST

Recently collected data on informal or unregistered firms in Argentina and Peru show significant differences between male and female-owned firms in certain firm characteristics and performance measures. Compared with male-owned firms, female-owned firms are smaller in size as measured by total monthly sales and also less efficient as measured by the average productivity of labor. Female-owned firms are less likely to use equipments such as machines and vehicles, although this is not the reason for their lower efficiency. Some of the commonly held views including lower education among women entrepreneurs, fewer numbers of owners among firms that have a female as the largest owner and greater difficulty faced by women in accessing credit are only weakly supported in the data. However, as documented in the literature, women managers have fewer years of experience in running a business and they are also more likely to operate from inside than outside household premises in order to avail better working hours and location. Some gender based differences in the willingness to register and the potential costs of registering are also observed in the data.

Comparing informal firms in Buenos Aires and Chaco (Short Note)

Mohammad Amin — Thu, 10 Feb 2011 13:38:13 PST

This note highlights differences in the structure, conduct and performance of informal businesses in two regions of Argentina, Buenos Aires and Chaco. Firm-efficiency as measured by the average productivity of labor is much higher in Buenos Aires than Chaco. This difference is partly due to higher sales and partly due to lower employment in firms in Buenos Aires compared with Chaco. Relative to Buenos Aires, firms in the Chaco region are more likely to use machinery and vehicles in the production process and they also face larger seasonal fluctuations in sales. Firms are more likely to report various benefits from registering including better access to finance, markets and government subsidies, less bribes to pay and the being able to issue receipts in Chaco than in Buenos Aires. Important firm-characteristics such as the level of education of the owner of the firm, corruption and crime as obstacles to business also differ sharply across the two regions. These findings suggest greater need to design policies towards the informal sector at the local than at the national level.

Efficiency, Firm-size and Gender: The Case of Informal Firms in Latin America

Mohammad Amin — Thu, 10 Feb 2011 13:32:11 PST

The paper extends the female under-performance hypothesis to informal or unregistered firms in two developing countries, Argentina and Peru. Specifically, results show that for a sample of informal firms, average productivity of labor and firm-size measured by monthly sales and employment are smaller for female-owned compared with male-owned firms.

Helpful Governments

Mohammad Amin — Thu, 26 Aug 2010 12:37:35 PDT

Using data on firm perceptions of how helpful the government is for doing business, we find strong evidence for the theory of legal origins: common law fares better than civil law. Advantages of using firm perceptions are discussed in detail.

Competition and Demographics in Large Indian Cities

Mohammad Amin — Thu, 19 Aug 2010 06:18:20 PDT

Recent studies suggest that consumer-household attributes may be as important in determining the level of competition in certain markets as firm characteristics and the number of firms. However, evidence on which consumer-household attributes matter for competition is limited, especially for developing countries. Focusing on India’s retail sector, the present paper contributes to this literature by showing that the number of adult non-workers per household in the city, a proxy for shopping time opportunity cost, has a strong effect on competition between retailers. Policy implications of our findings in light of the ongoing dramatic reductions in non-workers in India are discussed.

Immigrants in the Informal Sector: Evidence from Africa (Short Note)

Mohammad Amin — Thu, 29 Apr 2010 12:39:45 PDT

A survey of informal businesses in Burkina Faso, Cameroons and Cape Verde shows that roughly half of the businesses are owned by immigrants. Systematic differences between immigrant-owned and native-owned businesses might be expected given that immigrants are usually a vulnerable group and take time to assimilate with the native community. While the survey shows some important differences between native and immigrant owners of businesses, there is no clear evidence that relative to natives, immigrants are either discriminated against, are less efficient or come from a relatively less privileged background. However, immigrants are more likely to be males, unmarried and migrate when young; immigrant-owned businesses are smaller in size but also more efficient; the level of education is roughly same across natives and immigrants and so is the employment-unemployment status prior to starting the business. However, immigrant owners are less likely to have jobs in an established business and more likely to be victimized than the natives. Immigrants also appear to prefer the service sector over manufacturing compared with the natives and also more likely to operate from inside than outside household premises. We also find that some of the reported differences disappear as immigrants stay longer in the receiving city.

Crime against Informal Businesses in Africa: Natives vs. Immigrants

Mohammad Amin — Thu, 25 Mar 2010 14:07:55 PDT

The literature on crime seeks to identify groups of agents based on their socio-economic-demographic characteristics that are more likely to be victims of crime than others. The present paper contributes to this literature by focusing on crime against informal businesses in Africa and highlighting how victimization rates vary between businesses owned by natives and immigrants. We find that immigrant-owned businesses are significantly more likely to be targeted by criminals than native-owned businesses. However, much of this difference is due to higher victimization rates for businesses owned by recent immigrants to the city. Businesses owned by immigrants that have spent about 7 years or more in the city are not too different in the likelihood of being victimized than businesses owned by natives of the city.

Challenges of Retailing in India (A Short Note)

Mohammad Amin — Tue, 02 Mar 2010 12:50:18 PST

Using Enterprise Surveys data on 1,948 retails stores in India, this note highlights the key problems and challenges faced by retailers in 41 large cities of India. Inadequate power supply, access to finance, corruption, tax rates and land related problems are the most important obstacles to further growth. Competition in the sector also appears to be low, reducing labor productivity. Differences in the severity of these problems across regions and retail stores of various sizes are discussed.

Gender and Informality (A short note)

Mohammad Amin — Tue, 02 Mar 2010 06:51:17 PST

For a sample of informal firms in Burkina Faso, Cameroons, Cape Verde, Cote d’Ivoire, Madagascar and Mauritius, this note compares male and female owned businesses. The results provide mixed evidence on a number of hypotheses discussed in the literature for firms in the formal sector. First, the female under-performance hypothesis is confirmed, but only for firm-size. For firm-efficiency measured by the average productivity of labor, we find little difference across male and female owned businesses. Second, consistent with the view that women may face glass-ceiling in getting managerial positions, we find that women managers in our sample have less experience than male managers. However, this difference holds only within the sample of the relatively young firms. We provide some explanation for this heterogeneity across young and old firms. Third, as documented in the literature, there is greater proclivity among women relative to male entrepreneurs to work from home than outside. However, working from home does not appear to be disadvantageous to women entrepreneurs; at least, no more than for male entrepreneurs. In fact, working from home protects women owned businesses from crime and more so than male owned businesses. Last, women entrepreneurs are found less likely to have a bank account and use external sources of finance than male owned businesses. Reasons for not seeking a loan also appear to vary by the gender of the owner and are discussed.

Home-based Informal Businesses and the Gender Dimension

Mohammad Amin — Wed, 03 Feb 2010 13:14:00 PST

Anecdotal evidence suggests that working from home makes it easier to balance work and family life. This is particularly attractive to women, who are viewed as primary caregivers in the family in most developing countries. However, there is some concern in the literature that family responsibility may detract from doing business, leading to fewer hours of operation and lower efficiency for home-based businesses run by women. The present paper tests these hypotheses using data on informal or unregistered firms in five African countries. We find strong evidence that female entrepreneurs have a greater proclivity compared with male entrepreneurs to work from home than outside. However, differences between firms located inside vs. outside household premises in the number of hours a business normally operates and firm efficiency are neither economically large nor statistically significant. Further, these differences are roughly same for male and female managed businesses. In short, working from home does not appear to be disadvantageous to businesses, and it does not discriminate against women entrepreneurs.

[Data and Stata do files included]