Financial markets and firm size: The role of employment protection laws and barriers to entrepreneurship

Raquel Fonseca () and Natalia Utrero-González

Applied Economics, 2017, vol. 49, issue 26, 2515-2531

Abstract: This article provides evidence on the institutional determinants of firm size for the period 1980–1998. Using a comprehensive longitudinal database across 29 industrial sectors in 15 Organisation for Economic Co-operation and Development (OECD) countries, we study how labour regulations and barriers to entrepreneurship (BE) affect industrial organization in the presence of capital market frictions. We show that strict employment protection laws (EPL) and high BE negatively affect firm size in sectors that are more dependent on external funds. Our findings demonstrate that the interaction between market regulations and financial market imperfections help to explain some of the differences in firm structure across countries.

Date: 2017
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1080/00036846.2016.1243209 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:49:y:2017:i:26:p:2515-2531

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEC20

DOI: 10.1080/00036846.2016.1243209

Access Statistics for this article

Applied Economics is currently edited by Anita Phillips

More articles in Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().