||Table 9.3: SOUTH AFRICA, Extended prod|uction function<br>**ICA Meth**|and compar<br>**od**<sup>**1**</sup>|ison of ICA meth|od with EM algorit<br>**EM Algorithms**<sup>**2**</sup>|hms|
|---|---|---|---|---|---|---|
||**Dependent variable: Log of total sales**|||**[1]**|**[2]**|**[3]**|
|**Category**|**Variable**|**Coeff.**<br>**std. err.**|**Boot. st. er.**|**Coeff.**<br>**std. err.**|**Coeff.**<br>**std. err.**|**Coeff.**<br>**std. err.**|
|PF variables|Log-employment|0.3226<br>[0.0711]***|<br>(0.0365)***|0.3144<br>[0.0676]***|0.2285<br>[0.0667]***|0.2261<br>[0.0666]***|
||Log-materials|0.5195<br>[0.1017]***|<br>(0.0214)***|0.5355<br>[0.0942]***|0.5781<br>[0.0947]***|0.574<br>[0.0943]***|
||Log-capital|0.1247<br>[0.0300]***|(0.0118)***|0.1287<br>[0.0370]***|0.123<br>[0.0373]***|0.1282<br>[0.0386]***|
|Infrastructure|Days to clearcustomsfor imports (a)|-0.1188<br>[0.1125]|(0.1233)|0.1291<br>[0.1320]|0.0193<br>[0.0935]|0.0322<br>[0.0975]|
||Saleslost due to poweroutages (b)|-0.0171<br>[0.0114]|(0.0047)***|-0.0128<br>[0.0101]|-0.0112<br>[0.0077]|-0.0096<br>[0.0073]|
||Wateroutages (b)|-0.1477<br>[0.0527]***|<br>(0.0942)|-0.1287<br>[0.0438]***|-0.1482<br>[0.0533]***|-0.1611<br>[0.0562]***|
||Average durationoftransportfailures (a)|-0.0439<br>[0.0806]|(0.0379)|0.06<br>[0.0893]|0.0021<br>[0.0628]|-0.0156<br>[0.0611]|
||Waitforelectric supply (a)|-0.0867<br>[0.0553]|(0.0173)***|-0.1368<br>[0.0337]***|-0.0921<br>[0.0272]***|-0.0863<br>[0.0258]***|
||Sales lost due to delivery delays (b)|-0.0099<br>[0.0083]|(0.0073)|-0.0148<br>[0.0084]*|-0.0097<br>[0.0072]|-0.0077<br>[0.0065]|
|Red tape,|Manager's time spent onbur. issues (b)|0.007<br>[0.0051]|(0.0016)***|0.0077<br>[0.0050]|0.0077<br>[0.0057]|0.0084<br>[0.0058]|
|corruption and|<br>Payments to deal withbureaucraticissues (b)|-0.0045<br>[0.0024]*|(0.3604)|-0.005<br>[0.0026]*|-0.0042<br>[0.0023]*|-0.0121<br>[0.0038]***|
|crime|Sales declaredfortaxes (a)|0.0056<br>[0.0046]|(0.0022)**|0.0056<br>[0.0042]|0.0059<br>[0.0025]**|0.0058<br>[0.0027]**|
||Payments to obtaina contractwiththe government (b)|-0.0144<br>[0.0185]|(0.1975)|-0.0119<br>[0.0175]|-0.0161<br>[0.0146]|-0.015<br>[0.0144]|
||Security expenses (a)|0.1407<br>[0.0511]**|(0.0069)***|-0.0023<br>[0.0148]|-0.0075<br>[0.0109]|-0.0056<br>[0.0113]|
||Illegalpaymentsinprotection(b)|0.3969<br>[0.2428]|(0.1128)***|0.3754<br>[0.2492]|0.3882<br>[0.2202]*|0.4761<br>[0.2187]**|
||Crime losses (a)|-0.0502<br>[0.0788]|(0.1374)|-0.0541<br>[0.0948]|0.0099<br>[0.0621]|0.0193<br>[0.0662]|
|Finance and|Percentage ofcredit unused (b)|0.0014<br>[0.0010]|(0.0013)|0.0016<br>[0.0008]*|0.0019<br>[0.0010]*|0.002<br>[0.0010]*|
|corporate|Dummyfor loan|0.0715<br>[0.0492]|(0.0327)**|0.0841<br>[0.0479]*|0.0762<br>[0.0406]*|0.0761<br>[0.0407]*|
|governance|Value ofthe collateral(b)|-0.0008<br>[0.0002]***|<br>(0.0009)|-0.0007<br>[0.0002]***|-0.0006<br>[0.0002]***|-0.0007<br>[0.0002]***|
||Loansin foreigncurrency (b)|0.0018<br>[0.0022]|(0.0024)|0.0007<br>[0.0018]|-0.0002<br>[0.0012]|0.0001<br>[0.0012]|
||Charge to cleara check(a)|-0.1164<br>[0.0503]**|(0.0253)***|-0.0861<br>[0.0520]|-0.0995<br>[0.0387]**|-0.1068<br>[0.0384]***|
||Largest shareholder|0.0006<br>[0.0010]|(0.0008)|0.0011<br>[0.0010]|0.001<br>[0.0007]|0.0011<br>[0.0007]|
||Working capital financed byforeigncommercialbanks (b)|0.0106<br>[0.0083]|(0.0084)|0.0072<br>[0.0072]|0.0057<br>[0.0060]|0.0044<br>[0.0063]|
||Workingcapital financed byinformal sources(b)|-0.0022<br>[0.0023]|(0.0001)***|-0.0018<br>[0.0021]|-0.0027<br>[0.0018]|-0.0026<br>[0.0018]|
|Quality,|Dummyfor ISO quality certification(b)|0.1603<br>[0.0766]**|(0.0365)***|0.1521<br>[0.0732]**|0.0838<br>[0.0404]**|0.0782<br>[0.0390]*|
|innovation and|<br>Dummyfor newproduct (b)|0.091<br>[0.0494]*|(0.0113)***|0.1083<br>[0.0530]**|0.1053<br>[0.0461]**|0.1001<br>[0.0460]**|
|labor skills|Dummyfordiscontinued productline (b)|-0.1007<br>[0.0610]|(0.0384)**|-0.1029<br>[0.0560]*|-0.0874<br>[0.0541]|-0.0805<br>[0.0534]|
||Staff - management|0.004<br>[0.0028]|(0.0009)***|0.0036<br>[0.0028]|0.0034<br>[0.0030]|0.0032<br>[0.0030]|
||Staff - non-production workers|-0.0034<br>[0.0022]|(0.0025)|-0.0032<br>[0.0022]|-0.0023<br>[0.0022]|-0.0024<br>[0.0022]|
||Trainingforunskilledworkers (a)|0.001<br>[0.0026]|(0.0030)|-0.0001<br>[0.0038]|0.0018<br>[0.0019]|0.0008<br>[0.0021]|
||University staff(b)|0.0049<br>[0.0015]***|<br>(0.0007)***|0.0055<br>[0.0016]***|0.0039<br>[0.0014]***|0.0038<br>[0.0014]**|
||Manager's experience (b)|0.0391<br>[0.0249]|(0.0217)*|0.0369<br>[0.0222]|0.028<br>[0.0187]|0.0271<br>[0.0184]|
|Other control|<br>Age (b)|<br>0.0018<br>[0.0015]|(0.0016)|<br>0.0014<br>[0.0013]|<br>0.0023<br>[0.0013]*|<br>0.0023<br>[0.0013]*|
|variables|Share of the local market (b)|0.0032<br>[0.0008]***|(0.0004)***|0.0035<br>[0.0009]***|0.0027<br>[0.0007]***|0.0028<br>[0.0007]***|
||Constant|2.7174<br>[0.8932]***|(0.0365)***|2.0109<br>[0.8200]**|2.5368<br>[0.7330]***|2.5977<br>[0.7464]***|
||Industry/region/size/time dummies|Yes||Yes|Yes|Yes|
||Observations|1483||1528|1552|1550|
||R-squared|0.89||0.89|0.9|0.9|

Estimating results of equation (1) under different imputation mechanisms for missing data. Those observations with missing values in all sales, labor (labor cost), materials and capital are excluded in all the regressions.<sup>1, 2,</sup> See footnotes in Table 9.1. Source: Authors’ calculations with ICSs.

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