In a typical developing country, the majority of small firms are informal and entry costs into formality are high. This paper is motivated by these two observations. It asks the question of what can be expected in terms of firm investment, growth and formalization in such a setting. It also...

It is a well-established fact that the government bureaucracy in many developing countries is large, difficult to understand, non-transparent and time-consuming. However, “de jure” bureaucratic procedures sometimes have little to do with how firms or individuals actually go about when...

Intermediaries that assist individuals and firms with the government bureaucracy are common in developing countries. Although such bureaucracy intermediaries are, anecdotally, linked with corruption and welfare losses, few formal analyses exist.