Is informality contagious? An analysis of the effects of social conformism on the formalization of small business

Georges Dieudonné Mbondo (), Novice Patrick Bakehe () and Ariel Herbert Fambeu ()
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Georges Dieudonné Mbondo: University of Douala
Novice Patrick Bakehe: University of Douala
Ariel Herbert Fambeu: University of Douala

Economics Bulletin, 2022, vol. 42, issue 2, 317 - 329

Abstract: This study seeks to econometrically estimate the impact of social conformism on the will of managers to register their businesses. The data used is from the Second Employment and Informal Sector Survey (EESI 2) carried out in 2010 on 3560 micro and small Cameroonian businesses. Using an instrumental variable probit model, we find a positive and significant endogenous effect. However, we find that the social pressure which brings businesses to conformism acts only beyond a given threshold.

JEL-codes: J1 L2 (search for similar items in EconPapers)
Date: 2022-06-30
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