What is it about?

The aim of this paper is to evaluate the relationship between informality, innovation and firm survival. To do so, a study of a cluster of electrical fittings firms in Pakistan is reported.

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Why is it important?

Reporting bivariate and multivariate probit models to analyze two surveys conducted between 2008 and 2017, the finding is that there is a significant relationship between informality and the extent of innovation, firm survival and firm performance. Informality has an adverse negative effect on firm-level innovation, firm survival and firm performance. Given that formal enterprises in this cluster are better performing in terms of innovation, survival and employment growth than informal businesses, the paper concludes by discussing the theoretical, policy and research implications.

Perspectives

Explores the relationship between innovation, the informal sector and firm performance

Professor Colin C Williams
University of Sheffield

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This page is a summary of: THE IMPACTS OF INFORMALITY ON ENTERPRISE INNOVATION, SURVIVAL AND PERFORMANCE: SOME EVIDENCE FROM PAKISTAN, Journal of Developmental Entrepreneurship, September 2019, World Scientific Pub Co Pte Lt, DOI: 10.1142/s1084946719500158.
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