authors find that the measures of the Doing Business indicators of getting credit and contracts enforcement are positively associated with poverty reduction.

Similarly, Ciccone and Papaioannou (2007) show that in economies where new business registration time is lower, more new firms enter industries undergoing technology shifts and hence benefit from increasing global demand for their products. Darnihamedani et al. (2018) add to the ‘start-up costs - taxes - entry rate’ equation the firms’ propensity to innovate. Using the data on entrepreneurs from 53 countries, the authors find that corporate taxes have a negative relationship with innovative capacity of firms. They also show that higher start-up costs have a significant positive relationship with innovative entrepreneurship, arguing that reduction of entry costs may increase the number of firms. Jerbashian and Kochanova (2016) use industry-level data and World Bank’s Doing Business indicators for 14 OECD countries to demonstrate that high costs of starting a business and registering property decrease investments in information and communication technologies, while the strength of legal rights and of minority investor protection tend to increase such investments.

Bertrand and Kramarz (2002) draw a similar conclusion, finding that cumbersome business entry regulation for the retail sector in France hampered employment in the industry. The authors demonstrate that a burdensome requirement of an approval from a regional zoning board, when either creating or extending any large retail store in the country, decreased retail employment by more than 10%. Bailey and Thomas (2017) run fixed effects regressions using the U.S. data on firm employment and the extent of federal regulations, by industry and from 1998 to 2011. Their research demonstrates that fewer new firms were created and employment growth was slower in industries with heavier regulation. Also, Cacciatore and Fiori (2016) show that business regulation affects firm entry costs, workers’ unemployment benefits and firing restrictions. They use panel VAR estimates for OECD countries to demonstrate the recessionary short-run and expansionary long-run effects of reforms. The authors, thus, prove a strong effect of market deregulation on business cycle fluctuations’ efficiency.

In the context of construction permitting, another area measured by _Doing Business_ , Poel et al. (2014) find that higher administrative burdens adversely affect economic growth. Using a fixed effect regression analysis of data from 182 economies, the authors show a clear correlation between the number of days and procedures required to obtain a construction permit and economic growth. Plus, a similar relationship exists between economic growth and days and procedures to start a business as well as to pay taxes. Likewise, in the area of getting electricity, the analysis of Abotsi (2016), using the Enterprise Surveys data for Africa, demonstrates that the number of power outages experienced in a given month negatively impacts firms’ production efficiency. Several other studies emphasize the importance of effective tax regulation on firm formalization. Rocha et al. (2018) analyzing firm-level administrative and individual panel data in Brazil show that the costs of remaining formal in the case of taxes – and not entry costs – pose a serious obstacle to formalization. Specifically, reducing taxes after the registration costs have already been removed lowers firm informality rates, while registration costs reduction per se has no evident effect on informality. At the same time, lower taxes do not necessarily impact creation of new formal firms.

Analyzing regulation of property registration, Berkowitz et al. (2015) show that a property law enactment, which grants more rights to creditors over the assets that are used for loans to private firms leads to a substantial increase in firm value. And the impact is stronger on firms that are less politically connected, have lower internal cash flows and have more opportunities for 8