The ‘play’ of institutions and firm investment: Evidence from a transition economy
研究了在统一的国家制度环境下，地方制度执行质量如何影响企业创业投资，发现财务约束不同的企业对正式与非正式制度的敏感度不同，基于越南中小企业数据。
Abstract According to recent literature in new institutional economics and entrepreneurship, institutions, including formal and informal ones (i.e., the rules) are important. However, in a homogeneous national institutional environment, it is unclear whether and how the execution of institutions (how the rules are implemented) matters. The purpose of this research is to assess the mechanisms that local governments can use to encourage entrepreneurial investment, which determines the future growth potential of small businesses. We find that (i) improving local institutional quality in general boosts entrepreneurial investment; and (ii) more financially constrained firms are more sensitive to informal local governance, while less financially constrained firms are more sensitive to local formal institutions, using a large‐scale small and medium‐sized enterprise (SME) dataset from Vietnam from 2006 to 2019.