Working Paper Series: Special Edition of 2016 to 2018 Interns

The variable education is based on the managers’ average level of education and comes from section I of the survey. There were nine categories in level of education, as such for convenience they were re-categorized into four broader categories: primary & secondary, college & vocational, academic and other.

The variable larger has to do with whether the firm is part of a larger establishment. It is coded in binary format 1 = yes, 0 if otherwise.

Exporter is a dummy variable coded in binary format. It was constructed based on the percentage of the establishment sales that came from direct exports in the last fiscal year. For those firms that had exports sales > 0 a 1 one identified and those firm that had export sales ≤ 0 a zero was identified. International is a binary variable and comes from part B of the survey. It is based on whether the firm has an internationally recognised certification with a 1 = yes and 0 if otherwise. The variables Innovation and Product are all binary variables with a 1 = yes and 0 if otherwise. They have to do with whether the firm has a dedicated innovation department and those that launched or improved products. The variables audit and overdraft come from section J of the survey. These variables are also coded in binary form with 1 = yes and 0 if otherwise. They are based on whether the firm possesses certified annual financial statements or possess an overdraft facility respectively. Growth is a continuous variable; it measures the firms growth by looking at the growth in sales expressed in logarithmic form. It comes from section K in the survey that has to do with performance of firms. It is the difference between 2011 and 2012 sales divided by base year 2011 and scaled by exchange rate of 2.7 ECD to 1USD. Collateral is another binary variable and comes from section J of the survey. It is based on whether the firm purchased machinery, vehicles, equipment, land or buildings within the last financial year. It seems rational that if the firm is using bank credit to fund these purchases, more than likely, the

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