Table B3: Definition: Additional regressors

|**Variable name**|**Defnition**<br>annual labor roductivit rowth is measured b a ercentae chane in labor roductivit between|
|---|---|
|Productivity growth|py g y pg g py<br>the last completed fscal year and a previous period. Labor productivity is defned as the ratio<br>between sales and the number of full-time permanent workers. All sales values are defated to 2009<br>using each country’s GDP defators.|
|Investment|question k4: “In the last fscal year, did this establishment purchase any new or used fxed as-<br>sets, such as machinery, vehicles, equipment, land or buildings?”. Investment=1 if k4=yes, and 0<br>otherwise.|
|Local market|question e1: “In the last fscal year, which of the following was the main market in which this<br>establishment sold its main product?”. Available answers: i. Local (main product sold mostly in<br>same municipality where establishment is located), ii. National (main product sold mostly across<br>the country where establishment is located), and iii. International. Local market=1 if e1=i.|
|National market|National market=1 if e1=ii.|
|Board of directors|question bmb4: “Does the frm have a board of directors or a supervisory board?”.<br>Board of<br>directors=1 if bmb4=yes, and 0 otherwise.|
|Years manager experience|question b7: “How many years of experience working in this sector does the top manager have?”.<br>Years manager experience=log(1+b7).|
|Government ownership|question b2:<br>“What percentage of this frm is owned by each of the following”.<br>Government<br>ownership=b2c, “% Government or State”.|
|Female top manager|question b7a: “Is the Top Manager female?”. Female top manager=1 if b7a=yes, and 0 otherwise.|
|Female owner|question b4: “Amongst the owners of the frm, are there any females?”. Female owner=1 if b4=yes,<br>and 0 otherwise.|
|City 1|question a3: “Size of locality”. Available answers: i. “City with population above 1 Million”, ii.<br>“Over 250.000 to 1 million”, iii. “50,000 to 250,000”, iv. “Less than 50,000”. City 1=1 if a3=iv,<br>and 0 otherwise.|
|City 2|City 2=1 if a3=iii, and 0 otherwise.|
|City 3|City 3=1 if a3=ii, and 0 otherwise.|
|City 4|City 4=1 if a3=i, and 0 otherwise.|
|Electric outages (N)|question c7:<br>“In a typical month, over the last fscal year, how many power outages did this<br>establishment experience?”. Electric outages (N)=log(1+c7).|
|Electric outages (lenght)|question<br>c8:<br>“How<br>long<br>did<br>these<br>power<br>outages<br>last<br>on<br>average?”.<br>Electric<br>outages<br>(lenght)=log(1+c8).|
||Bribery depth is computed similarly as the Graft Index from Gonzalez et al. (2007). it is con-<br>structed from the following questions. Question c5: “In reference to that application for an elec-<br>trical connection, was an informal gift or payment expected or requested?”. Question c14: “In<br>reference to that application for a water connection, was an informal gift or payment expected or|
|Bribery depth|requested?”. Question g4: “In reference to that application for a construction-related permit, was<br>an informal gift or payment expected or requested?”. Question j5: “In any of these inspections or<br>meetings (with tax ofcials) was a gift or informal payment expected or requested?”. Question j12:<br>“In reference to that application for an import license, was an informal gift or payment expected<br>or requested?”. Question j15: “In reference to that application for an operating license, was an<br>informal gift or payment expected or requested?”.|
||question j7:<br>“It is said that establishments are sometimes required to make gifts or informal|
|Gifts (share)|payments to public ofcials to “get things done” with regard to customs, taxes, licenses, regulations,<br>services etc. On average, what percentage of total annual sales do establishments like this one pay<br>in informal payments or gifts to public ofcials for this purpose?”.|
||question j30: “As I list some factors that can afect the current operations of a business, please<br>look at this card and tell me the degree to which you think each factor is an obstacle to the current|
|Constrained by corruption|operations of this establishment”. Available options: i. no obstacle, ii. minor obstacle, iii. moderate<br>obstacle, iv. major obstacle, or v. very severe obstacle. Constr. corruption=1 if j30= iv. or v., and<br>0 otherwise.|
||question i4: “In the last fscal year, what were the estimated losses as a result of theft, robbery,|
|Loss from theft|vandalism or arson that occurred on this establishment’s premises either as a percentage of total<br>annual sales?”.|
|Constrained by crime|question i30: “To what degree is Crime, Theft and Disorder an obstacle to the current operations<br>of this establishment?”. Available options: i. no obstacle, ii. minor obstacle, iii. moderate obstacle,<br>iv. major obstacle, or v. very severe obstacle. Constr. crime=1 if i30= iv. or v., and 0 otherwise.|
||questionf1:“Inthelastfscalyearwhatwasthisestablishment’soutputproducedasapercentage|
|Capacity utilization|, <br>of the maximum output possible if using all the resources available (capacity utilization)?”.|

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