Abstract
We analyze the formality benefits through productivity-enhancing public goods. We document that: benefits from formality matter for firms’ optimal decisions; there is a disconnect between the objectives of maximizing formality versus welfare; this disconnect is mitigated under higher formality benefits.
| Original language | English |
|---|---|
| Journal | Economics Letters |
| Volume | 124 |
| Issue number | 1 |
| Pages (from-to) | 151-156 |
| ISSN | 0165-1765 |
| DOIs | |
| Publication status | Published - 2014 |
Cite this
Mendicino, C., & Prado, M. (2014). Heterogeneous Firms and the Impact of Government Policy on Welfare and Informality. Economics Letters, 124(1), 151-156. https://doi.org/10.1016/j.econlet.2014.04.018