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Table 12 Robustness to industry size definition; average tariff and informality; OLS and IV estimation.

From: Trade liberalization and informality in Argentina: exploring the adjustment mechanisms

  OLS IV
Option 1 Option 2 Option 1 Option 2
(1) (2) (3) (4) (5) (6) (7) (8)
A) Definition 1: share of small-size firms in industry
 Log of average tariff 0.016 [0.017] 0.005 [0.015] 0.020 [0.016] 0.010 [0.015] − 0.042 [0.023]* − 0.058 [0.039] − 0.016 [0.024] − 0.027 [0.037]
 Observations 32 32 32 32 32 32 32 32
 \(R^2\) 0.94 0.94 0.94 0.94     
First stage result
 Average z 2      − 0.418 [0.098]*** − 0.430 [0.120]*** − 0.402 [0.096]*** − 0.429 [0.119]***
 Observations      32 32 32 32
 \(R^2\)      0.74 0.76 0.72 0.74
B) Definition 2: indicator of small-size industry
 Log of average tariff 0.011 [0.017] 0.000 [0.015] 0.019 [0.016] 0.009 [0.016] 0.038 [0.023] 0.021 [0.038] 0.000 [0.025] − 0.009 [0.037]
 Observations 32 32 32 32 32 32 32 32
 \(R^2\) 0.94 0.94 0.94 0.94     
First stage result
 Average \(z^2\)      − 0.422 [0.098]*** − 0.423 [0.119]*** − 0.407 [0.095]*** − 0.431 [0.118]***
 Observations      32 32 32 32
 \(R^2\)      0.74 0.76 0.73 0.75
Log relative supply Yes Yes Yes Yes Yes Yes Yes Yes
Educational level of the labor force Yes Yes Yes Yes Yes Yes Yes Yes
Fraction of small firms No Yes No Yes No Yes No Yes
  1. Robust standard errors clustered by year in brackets. Average \(z^{2}\) is the average of the instrument based on exchange rates of main partners weighted by the participation of each industry in total employment
  2. ***Significant at 1%
  3. *Significant at 10%