RT Journal Article
SR 00
ID 10.1111/ecin.12301
A1 Massenot, Baptiste
A1 Straub, Stéphane
T1 Informal Sector and Economic Development: The Credit Supply Channel
JF Economic Inquiry
YR 2016
FD 2016-04
VO 54
IS 2
SP 1046
OP 1067
AB A standard view holds that removing barriers to entry and improving judicial enforcement would reduce informality and boost investment and growth. We show, however, that this conclusion may not hold in countries with a concentrated bank- ing sector or with low financial openness. When the formal sector becomes larger in those countries, more entrepreneurs become creditworthy and the higher pres- sure in the credit market increases the interest rate. This reduces future capital accumulation. We show some empirical evidence consistent with these predictions.
SN 0095-2583
LK https://publications.ut-capitole.fr/id/eprint/18608/
UL http://tse-fr.eu/pub/29846