Costa Rica : Investment Climate Assessment
The objective of the Costa Rica Investment Climate Assessment (ICA) is to evaluate constraints on growth of the private sector in Costa Rica using a survey of 343 manufacturing firms known as the Investment Climate Survey (ICs) and a Logistic Surve...
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| Language: | English |
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Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2007/02/7591241/costa-rica-investment-climate-assessment-costa-rica-investment-climate-assessment http://hdl.handle.net/10986/7691 |
| Summary: | The objective of the Costa Rica
Investment Climate Assessment (ICA) is to evaluate
constraints on growth of the private sector in Costa Rica
using a survey of 343 manufacturing firms known as the
Investment Climate Survey (ICs) and a Logistic Survey in 75
firms in three export sectors (processed foods, cut flowers
and plants, and medical equipment). This assessment focuses
on the microeconomic and structural dimensions of the
nation's business environment, viewed from an
international perspective. In evaluating the most important
investment climate constraints affecting Costa Rican
establishments, this report uses both subjective and
objective indicators. The emphasis is placed on the second
type of information. Surveyed Costa Rican firms perceive
macroeconomic instability, anti-competitive and informal
practices, and cost and access to financing as the four
major obstacles to growth in Costa Rica. Transport and
corruption issues are also among the top major or severe
constraint for Costa Rican firms. When asked to select the
main obstacle to growth, surveyed manufacturing firms cited
financial constraints as their predominant problem, followed
by anti-competitive/informal practices, macroeconomic
stability and red tape/regulation. A number of investment
climate indicators drawn from the ICs were econometrically
related to measures in productivity. Overall results of the
ICs show that variables in all four categories of investment
climate affect Costa Rican firms in terms of their
productivity. In addition to the analysis on firm
productivity, the econometric analysis looked at the effect
of investment climate variables on the probability of
exporting. The conclusions of the econometric analysis are
that investment climate variables significantly affect total
factor productivity and that increased emphasis on
governance and business regulation, infrastructure, and
innovation is appropriate. The results shown are consistent
with firms' perceptions that put infrastructure and
regulatory issues as severe obstacles to growth. |
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