This paper studies the role of credit market imperfections and corruption on the process of economic development. We address the question of how much of the differences in output per capita across countries can be attributed to differences in credit market policies and corruption. In order to...

This paper examines how much of the difference in the size of the informal sector and in per capita income across countries can be accounted by regulation costs (barriers to legality) and contractual imperfections in financial markets (legal failures). It constructs and solves numerically a...

This paper establishes the existence of a stationary equilibrium and a procedure to compute solutions to a class of dynamic general equilibrium models with two important features. First, occupational choice is determined endogenously as a function of heterogeneous agent type, which is defined by...

This paper studies the effect of financial repression and contract enforcement on entrepreneurship and economic development. We construct and solve a general equilibrium model with heterogeneous agents, occupational choice and two financial frictions: intermediation costs and financial contract...

This paper investigates the relationship between institutions and economic development (output per worker). As in Hall and Jones (1999), we find that a 1% improvement in institutions (as we measure them) generates on average a 5% increase in output per worker. However, this relationship is not...

This paper analyzes the behavior of firms with defaulted credits in terms of recovery or extinction. By defining classes for the severity of default, survival models for the multiple transitions from each class are estimated. The models are used to simulate the evolution of a firm’s credit...

We study the effects of different labor market policies on employment composition in a matching model with salaried work and self-employment. We empirically assess some of the model’s predictions using micro data from the European Union Household Panel. Policies such as employment protection...

We study the impact of financial variables upon bankruptcy and voluntary exit. Controlling for efficiency, which we find to decrease the odds of both bankruptcy and voluntary exit, characteristics of firms which correlate with the firms' access to funds, exert very different impacts upon the two...