In the ever-evolving landscape of global business, unicorn firms—startups valued at over $1 billion—have emerged as epitomes of business dynamism. They are not just disruptors; they are the vanguards of innovation, driving the three main components of business dynamism: entry, growth, and exit. Unicorns leverage groundbreaking ideas, cutting-edge technologies, and new … [Read more...] about Unicorn Firms and Business Dynamism
The Unexpected Ripple Effects of Disability Employment Quotas
In 1991, Brazil passed a landmark Quota Law intended to promote the hiring of people with disabilities and overcome some of the obstacles they face in the labor market. But the law, calling on companies employing more than 100 workers to allocate at least 2% of jobs to people with disabilities, came up short. It lacked compliance or enforcement, and by 2009 less than one-third … [Read more...] about The Unexpected Ripple Effects of Disability Employment Quotas
Business Dynamism is on the Decline Globally
Business dynamism occurs when new firms enter the market, existing firms expand, and less productive firms exit. But business dynamism is fading in many economies around the world, disrupting the process by which resources, such as labor and capital, are allocated efficiently in the economy. Much of the evidence for this can be seen in advanced economies, like … [Read more...] about Business Dynamism is on the Decline Globally
Can AI Technologies Help Expand Credit Access?
Despite the proliferation of digital technologies in daily market transactions, about 45% of Latin America's population do not use bank accounts, and credit access for individuals and firms is limited. Technologies based on Artificial Intelligence (AI) can help change that. AI can efficiently incorporate big data into credit risk assessments, allowing financial institutions … [Read more...] about Can AI Technologies Help Expand Credit Access?
The Tradeoff in Large Foreign Firms’ Dominance of Export Markets
It is no secret that in many developing countries large foreign firms dominate the export market, giving them immense power to determine the prices at which a vast group of small exporting firms sell their goods. On the surface, this would seem to be a mostly negative phenomenon. In a recent study I conducted, for example, I found that these large foreign buyers impose … [Read more...] about The Tradeoff in Large Foreign Firms’ Dominance of Export Markets