MIT Press

Table 7.

Contribution of Variables to the Explained Dispersion of τ_k (%)

	OLS Regressions		IV Regressions
	(1)	(2)	(3)	(4)
Access to finance	24.36	26.35	21.68	20.37
Private loan (yes = 1)	7.45	7.47	7.97	7.86
Public loan (yes = 1)	3.55	2.11	0.20	0.23
Access to finance × Private loan		0.20		8.89
Access to finance × Public loan		1.59		−3.70
Electricity	0.48	0.46	0.23	0.22
Transportation	0.13	0.12	−0.04	−0.04
Customs and trade regulations	3.40	3.26	−0.51	−0.57
Informal sector	4.00	3.85	1.73	1.60
Access to land	0.10	0.12	−0.12	−0.10
Crime, theft	0.15	0.15	0.62	0.60
Tax rates	0.98	0.95	1.80	1.72
Tax administration	0.89	0.87	0.81	0.79
Business licensing	0.19	0.18	1.51	1.40
Political instability	−0.35	−0.35	0.47	0.40
Corruption	0.40	0.39	0.36	0.34
Courts	2.55	2.47	3.70	3.28
Labor regulations	0.29	0.28	2.07	1.92
Inadequate education workers	0.73	0.70	2.25	2.07
All obstacles	49.29	51.19	44.74	47.26
Country dummies	48.17	46.41	55.50	53.14
Sector dummies	2.54	2.40	−0.24	−0.41
Total	100	100	100	100

	OLS Regressions		IV Regressions
	(1)	(2)	(3)	(4)
Access to finance	24.36	26.35	21.68	20.37
Private loan (yes = 1)	7.45	7.47	7.97	7.86
Public loan (yes = 1)	3.55	2.11	0.20	0.23
Access to finance × Private loan		0.20		8.89
Access to finance × Public loan		1.59		−3.70
Electricity	0.48	0.46	0.23	0.22
Transportation	0.13	0.12	−0.04	−0.04
Customs and trade regulations	3.40	3.26	−0.51	−0.57
Informal sector	4.00	3.85	1.73	1.60
Access to land	0.10	0.12	−0.12	−0.10
Crime, theft	0.15	0.15	0.62	0.60
Tax rates	0.98	0.95	1.80	1.72
Tax administration	0.89	0.87	0.81	0.79
Business licensing	0.19	0.18	1.51	1.40
Political instability	−0.35	−0.35	0.47	0.40
Corruption	0.40	0.39	0.36	0.34
Courts	2.55	2.47	3.70	3.28
Labor regulations	0.29	0.28	2.07	1.92
Inadequate education workers	0.73	0.70	2.25	2.07
All obstacles	49.29	51.19	44.74	47.26
Country dummies	48.17	46.41	55.50	53.14
Sector dummies	2.54	2.40	−0.24	−0.41
Total	100	100	100	100

IV = instrumental variable, OLS = ordinary least squares.

Source: Authors’ calculations.