Assessing the Impact of the Implementation of the Individual Micro-Entrepreneur Act in Brazil

Gabriel Marcuzzo do Canto Cavalheiro, Sandra Regina Holanda Mariano

Resumo


Abstract

Entrepreneurship is widely acknowledged to be a phenomenon of central importance in our society. Within the arena of entrepreneurship policy, a more specific trend has been an increase in recent years in informal entrepreneurship, especially in developing countries. Therefore, this article seeks to contribute to filling a knowledge gap in the entrepreneurship literature using empirical evidence to assess the impact of the implementation of the Individual Micro Entrepreneur Act on the formalization of small businesses in Brazil. Based on empirical data retrieved from e-government portals, our study provides evidence that this legislation is being used as a large-scale legal instrument for labor market deregulation in many sectors. Additionally, we could also observe a strong increase in the number of Brazilian citizens officially registered as individual micro entrepreneurs, especially in urban areas and focusing on activities, such as hairdressers, manicures, pedicures, masonry works, and sales promotion. It was possible to observe that rather many informal workers did not become an entrepreneur, but a formal employee after the implementation if the Individual Micro Entrepreneur Act.    

Key-words: informal entrepreneurship; firm formalization; public policy; regional development; Brazil


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DOI: https://doi.org/10.6034/rmpe.v17i3.1859

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