{"id":18945,"date":"2020-03-19T17:40:47","date_gmt":"2020-03-19T16:40:47","guid":{"rendered":"https:\/\/www.femise.org\/?p=18945"},"modified":"2020-03-19T17:43:45","modified_gmt":"2020-03-19T16:43:45","slug":"cronyism-firms-productivity-and-informal-competition-in-egypt-femise-commissioned-paper","status":"publish","type":"post","link":"https:\/\/www.femise.org\/en\/publications-en\/cronyism-firms-productivity-and-informal-competition-in-egypt-femise-commissioned-paper\/","title":{"rendered":"Cronyism, firms\u2019 Productivity and Informal Competition in Egypt (FEMISE Commissioned Paper)"},"content":{"rendered":"

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This paper* investigates the role of informal firms\u2019 competition in determining the micro-level effect of cronyism on formal-firms\u2019 productivity in the aftermath of the 2011 Egyptian revolution. Based on the World Bank panel Enterprise Surveys, we follow a constructive approach to indicate politically connected firms based on the findings of the previous literature. Using a propensity score reweighting \u2013 difference-in-difference estimator, we find that being a crony firm after the revolution could generate unsustainable gains in terms of productivity. This is mostly due to cronyism externalities that engenders a stronger intensity of informal competition, which jeopardizes any increase in productivity and creates a large disequilibrium at the firm level. We also provide evidence that crony firms\u2019 excess in labor is the main channel through which this effect occurs. Hence, crony firm survival in Egypt depends on their ability to balance between the sustain provision of privileges and the threats imposed by the growth of the informal sector.<\/p>\n

This is a joint ERF \u2013 FEMISE\u00a0 publication.<\/p>\n

\"\"* Support from the European Union through the FEMISE project on \u201cSupport to Economic Research, Studies and Dia\u00adlogues of the Euro-Mediterranean Partnership\u201d gratefully acknowledged. Any views expressed in this report are the sole responsibility of the authors.<\/p>\n","protected":false},"excerpt":{"rendered":"

Download by clicking here This paper* investigates the role of […]<\/p>\n","protected":false},"author":7,"featured_media":18929,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0},"categories":[230,7,38,11],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/posts\/18945"}],"collection":[{"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/comments?post=18945"}],"version-history":[{"count":3,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/posts\/18945\/revisions"}],"predecessor-version":[{"id":18950,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/posts\/18945\/revisions\/18950"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/media\/18929"}],"wp:attachment":[{"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/media?parent=18945"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/categories?post=18945"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.femise.org\/en\/wp-json\/wp\/v2\/tags?post=18945"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}