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Firm Entry Deregulation, Competition and Returns to Education and Skill

Author

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  • Winters, L Alan
  • Fernandes, Ana P.
  • Ferreira, Priscila
Abstract
This paper investigates the effects of firm entry deregulation. We exploit a recent reform that simplified business entry in Portugal as a quasi-natural experiment. We use cross-municipality-year variation in the implementation of the reform for identification. Using matched employer-employee data for the universe of workers and firms, we find that the reform is associated with increased firm entry and competition within industries and regions. The returns to a university degree increased by 5% while the returns to skills increased by 3%.

Suggested Citation

  • Winters, L Alan & Fernandes, Ana P. & Ferreira, Priscila, 2013. "Firm Entry Deregulation, Competition and Returns to Education and Skill," CEPR Discussion Papers 9550, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:9550
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    Cited by:

    1. Piton Céline & Rycx François, 2019. "Unemployment Impact of Product and Labor Market Regulation: Evidence from European Countries," IZA Journal of Labor Policy, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 9(1), pages 1-32, June.
    2. Priscila Ferreira, 2019. "Market competition and executive pay," IZA World of Labor, Institute of Labor Economics (IZA), pages 115-115, February.
    3. Winters, L Alan & Fernandes, Ana P. & Ferreira, Priscila, 2014. "The Effect of Competition on Managers? Compensation: Evidence From a Quasi-natural Experiment," CEPR Discussion Papers 10054, C.E.P.R. Discussion Papers.
    4. Cooke, Dudley & Fernandes, Ana P. & Ferreira, Priscila, 2019. "Product market competition and gender discrimination," Journal of Economic Behavior & Organization, Elsevier, vol. 157(C), pages 496-522.
    5. Cooke, Dudley & Fernandes, Ana P. & Ferreira, Priscila, 2021. "Entry deregulation, firm organization, and wage inequality," International Journal of Industrial Organization, Elsevier, vol. 77(C).
    6. Francesco Castellaneta & Raffaele Conti & Aleksandra Kacperczyk, 2020. "The (Un) intended consequences of institutions lowering barriers to entrepreneurship: The impact on female workers," Strategic Management Journal, Wiley Blackwell, vol. 41(7), pages 1274-1304, July.
    7. Lergetporer, Philipp & Ruhose, Jens & Simon, Lisa, 2018. "Entry Barriers and the Labor Market Outcomes of Incumbent Workers: Evidence from a Deregulation Reform in the German Crafts Sector," IZA Discussion Papers 11857, Institute of Labor Economics (IZA).
    8. Brand, Claus & Obstbaum, Meri & Coenen, Günter & Sondermann, David & Lydon, Reamonn & Ajevskis, Viktors & Hammermann, Felix & Angino, Siria & Hernborg, Nils & Basso, Henrique & Hertweck, Matthias & Bi, 2021. "Employment and the conduct of monetary policy in the euro area," Occasional Paper Series 275, European Central Bank.
    9. Céline Piton, 2018. "The unemployment impact of product and labour market regulation: Evidence from European countries," Working Paper Research 343, National Bank of Belgium.
    10. Fernandes, Ana P. & Ferreira, Priscila, 2021. "Executives’ gender pay gap and financing constraints," Journal of Economic Behavior & Organization, Elsevier, vol. 192(C), pages 381-404.
    11. Lena Edlund & Cecilia Machado & Maria Sviatschi, 2022. "Gentrification and the Rising Returns to Skill," Economica, London School of Economics and Political Science, vol. 89(354), pages 258-292, April.
    12. Céline Piton, 2018. "The unemployment impact of product and labour market regulation: Evidence from European countries," Working Paper Research 343, National Bank of Belgium.
    13. Lisa Simon, 2019. "Microeconometric Analyses on Determinants of Individual Labour Market Outcomes," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 83.

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    More about this item

    Keywords

    Entry deregulation; Product market competition; Returns to education; Wage structure;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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