Macro-Structural Obstacles to Firm Performance: Evidence from 2,640 Firms in Nigeria

May 22, 2020

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Amr Hosny. Macro-Structural Obstacles to Firm Performance: Evidence from 2,640 Firms in Nigeria, (USA: International Monetary Fund, 2020) accessed December 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

A recent World Bank enterprise survey identified access to finance as the top constraint to Doing Business in Nigeria. In this context, the objective of this paper is two-fold: (i) study firm characteristics associated with more access to finance and export diversification; and (ii) quantify the impact of these structural obstacles on firm performance. Results suggest that (i) larger and export-oriented firms are about 40 percentage points less likely to report access to finance as a business obstacle, while firms perceiving access to finance as a constraint are, on average, about 10-40 percentage points less likely to be export-oriented diversified firms; and (ii) better access to finance and export diversification can help firm employment —as much as 80 percent higher— and capacity utilization. Results are largely robust to different specifications and estimation methods.

Subject: Business environment, Capacity utilization, Credit, Economic sectors, Employment, Export diversification, Exports, International trade, Labor, Money, Production

Keywords: Access to credit, Business environment, Capacity utilization, Credit, Employment, Enterprise surveys, Export, Export diversification, Export orientation, Exports, Firm, Firm level, Firm performance, Global, Nigeria, Nigeria enterprise survey question, Sub-Saharan Africa, Survey response, WP

Publication Details

Pages:

21
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2020/062
Stock No:

WPIEA2020062
ISBN:

9781513545363
ISSN:

1018-5941

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