The Effect of Firm-Size Dependent Policies on the Economy: The Case of the Repecos Law in Mexico

Claudia Sánchez-Vela and Jorge Valero-Gil ()

No 4549, IDB Publications (Working Papers) from Inter-American Development Bank

Abstract: This paper analyzes the effects of a firm-size dependent law, on the Mexican economy which includes a small taxpayers' regime known in Mexico as the Repecos regime. It looks for effects on macroeconomic variables and on the industrial structure, on the proportion of small firms in the economy, which are originated in such regime. It uses a general equilibrium model calibrated on the U.S. economy and applies an environment of high taxes on labor and high tax evasion, characteristic of the Mexican economy, so that their effects can be distinguished from those of the Repecos regime.

Keywords: Small taxpayers; size distortions; Establishment size; Legal effects (search for similar items in EconPapers)
JEL-codes: E26 H25 H26 L23 O54 (search for similar items in EconPapers)
Date: 2011-02
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:idb:brikps:4549

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