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Predation, protection, and productivity: a firm-level perspective

Besley, Timothy and Mueller, Hannes (2017) Predation, protection, and productivity: a firm-level perspective. American Economic Journal: Macroeconomics. ISSN 1945-7707 (In Press)

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Abstract

This paper studies the consequences of predation when firms deploy guard labor as a means of protecting themselves. We build a simple model and combine it with data for 144 countries from the World Bank enterprise surveys which ask about firm-level experiences with predation and spending on protection. We use the model to estimate the output loss caused by the misallocation of labor across firms and from production to protection. The loss due to protection effort is substantial and patterns of state protection at the micro level can have a profound impact on aggregate output losses. Various extensions are discussed.

Item Type: Article
Official URL: https://www.aeaweb.org/journals/mac
Additional Information: © 2017 American Economic Association
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor
Sets: Departments > Economics
Date Deposited: 30 Aug 2017 13:46
Last Modified: 30 Aug 2017 13:53
Projects: ECO2015-66883-P, SEV-2015-0563
Funders: Ramon y Cajal Programme, Spanish Government and the Spanish Ministry of Economy and Competitiveness
URI: http://eprints.lse.ac.uk/id/eprint/84144

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