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Business Dynamics and Red Tape Barriers

Author(s): Daria Ciriaci

Business Dynamics and Red Tape Barrierspdf(614 kB) Choose translations of the previous link 

Summary for non-specialistspdf(46 kB) Choose translations of the previous link 

Entry is a key element of the transmission mechanism through which product market reforms ultimately affect productivity and growth. Therefore, reforms aiming at facilitating firms' entry can be considered as giving an extra bonus in the sense that they facilitate the materialization of the full effect of other competition-enhancing reforms. By the light of these considerations, this study aims at estimating the impact of changes in the administrative cost of starting a business and/or exporting on entry dynamics in 17 European member countries (AT, BE, CZ, DE, DK, EE, ES, FI, FR, HU, IT, NL, PL, PT, SE, SK and UK) during the period 2004-2011. Results confirm the theoretical expectation: the higher the level of red tape barriers, the lower entry dynamics.

(European Economy. Economic Papers 532. September 2014. Brussels. PDF. 28pp. Tab. Graph. Ann. Bibliogr. Free.)

KC-AI-14-532-EN-N (online)KC-AI-14-532-EN-C (print)
ISBN 978-92-79-35181-5 (online)ISBN 978-92-79-36147-0 (print)
doi: 10.2765/71361 (online)doi: 10.2765/80777 (print)

JEL classification: D21, D22

Economic Papers are written by the staff of the Directorate-General for Economic and Financial Affairs, or by experts working in association with them. The Papers are intended to increase awareness of the technical work being done by staff and to seek comments and suggestions for further analysis. The views expressed are the author’s alone and do not necessarily correspond to those of the European Commission.

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