**Table 3: Variables and Descriptions**

|Variable|Description|
|---|---|
|_laborproductivity_|the(logof)annual sales revenues divided bythe number of full-timepermanent employees. All values are deflated to 2005 USD.|
|_Log(Size)_|the(logof)total number of employment inyear_t_.|
|_Log(Age)_|is the (log of) the number of years that the firm has been in operation. Due to concerns that other co-variates may be endogenous with age we also<br>utilize a second variable, age collapsed, which is the collapsed, weighted average of age within each economy-sector (manufacturing, retail, or other<br>services)combination.|
|_female ownership_|takes value of 1 if there is femaleparticipation in ownership|
|_bankfinancing_|takes a value of 1 if a firm reports non-zero values for bank financingof workingcapital and/or fixed-asset investment|
|_Limited liability_|A dummyvariable takinga value of 1 if the firm is a limited liabilitycompany,and zero otherwise.|
|_Exporter_|indicates if a firm has exports that represents at least 10% of its annual sales|
|_Foreign _|indicates if a firm has at least 10% foreign ownership|
|_labor productivity (competitors)_|is the weighted, collapsed average of labor productivity within a firm’s sector-country. For coverage issues, sector is widely defined here as<br>manufacturing,retail,and other services.|
|_retail_|takes a value of 1 if a firm is in the retail sector|
|_services_|takes a value of 1 if a firm is in selected services sectors,excludingretail|
|_GDPper capita_|the(logof)an economy’s GDPper capita at the time of the first surveyround,in 2005 USD(source: World Development Indicators)|
|_GDPgrowth_|the runningaverage of an economy’s GDPgrowth in theyears between surveyrounds(source: World Development Indicators)|
|_Openness_|the sum of exports and imports of an economy, both expressed as % of GDP in the year corresponding to the initial survey round (source: World<br>Development Indicators)|
|_Ease of entry (DB)_|the simple running average of the World Bank’s Doing Business indicators for “Starting a Business”, using the DTF indicator over the years between<br>the surveyrounds,coded that a higher rank indicates higher ease of entry (source: DoingBusiness,www.doingbusiness.org)|
|_Resolving insolvency (DB)_|the simple running average of the World Bank’s Doing Business indicators for “Resolving Insolvency”, using the DTF indicator over the years between<br>the surveyrounds,coded that a higher rank indicates higher ease of exit in terms ofproceedingthrough bankruptcy.|
|_New-firm density_|Number new businesses (LLCs) per 1000 people, running average over period between surveys. Source: WDI<br>(http://econ.worldbank.org/research/entrepreneurship)<sup>23</sup>|
|_comp_|Is the weighted number of estimated establishments in a firm’s industry (by 2-digit ISIC code) and location of stratification, based on ES design<br>information,and is considered aproxyfor the number of competitors in a firm’s market.|

> 23 For Moldova, due to missing values the 5-yr. running average is used, as opposed to the 4-yr. average. Data not available for the DRC, Ecuador, Honduras, Kenya, Mongolia, Nicaragua, Paraguay, Poland, Tanzania, and Yemen. Due to coverage issues, results using this co-variate should be interpreted with the caveat that full surveys are not included due to missing macro-variables.

29