Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/190005 
Authors: 
Year of Publication: 
2017
Series/Report no.: 
WIDER Working Paper No. 2017/160
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
Using a 10-year panel survey covering Vietnamese manufacturing firms, we consistently obtain firm-specific mark-up estimates and relate these to firm-level formality. The average firm-specific mark-up using a trans-log revenue production function specification is estimated to be 1,445, with substantial underlying variation across firm size, location, sector, and ownership form. Zooming in on firm-level registration, we find a formality premium of 16 per cent, even when controlling for selection into formality. Moreover, a firm size threshold exists, confirming that smaller informal firms are less likely to reap eventual benefits of formalization. Finally, we find remarkable similarity between average self-reported and estimated mark-ups, but dynamic aspects of the two estimates along key firm dimensions differ substantially.
Subjects: 
firm productivity and mark-ups
formality
Viet Nam
JEL: 
D22
L25
O14
O53
Persistent Identifier of the first edition: 
ISBN: 
978-92-9256-386-8
Document Type: 
Working Paper

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