The formation of new firms: An ordered probit model approach for Latin American and Caribbean Countries

Produced by: 
Universidad Católica de Colombia
Available from: 
December 2014
Paper author(s): 
Vélez Ospina, Jorge Andres
Campo Robledo, Jacobo
Microeconomics - Competition - Productivity
Poverty - Inequality - Aid Effectiveness

The purpose of this paper is to identify the factors that affect the creation of new firms in Latin American countries. We take into consideration economic, political, social and technological factors which should also help governments realize the areas that we found to have the greatest impact. The study relies on data from international organizations from which we construct an Ordered Probit model. The results indicate that credit and government effectiveness enhance the probability of generating new business but it depended of business density.


Research section: 
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