TY  - BOOK
AU  - Farazi,Subika
AU  - Farazi,Subika
AU  - Rostom,Ahmed
AU  - Sinha,Rishabh
TI  - Investment under Risks and Uncertainty in Afghanistan
PY  - 2018///
CY  - Washington, D.C.
PB  - The World Bank
KW  - Access to Finance
KW  - Business Cycles and Stabilization Policies
KW  - Common Carriers Industry
KW  - Construction Industry
KW  - Crime and Society
KW  - Education
KW  - Educational Sciences
KW  - Finance and Financial Sector Development
KW  - Financial Frictions
KW  - Food and Beverage Industry
KW  - General Manufacturing
KW  - Industry
KW  - Investment Decisions
KW  - Macroeconomics and Economic Growth
KW  - Plastics and Rubber Industry
KW  - Pulp and Paper Industry
KW  - Risks
KW  - Social Development
KW  - Textiles Apparel and Leather Industry
KW  - Uncertainty
N2  - This paper investigates the state of low investment in Afghanistan by studying how investment decisions interact with risks and uncertainty in the presence of underdeveloped financial markets. The analysis shows that investing firms experience a higher probability of being affected by events related to crime and corruption and spend more on security arrangements. Firms that participate in the formal financial sector are also subject to higher levels of risk and uncertainty. As more productive firms face higher risks and uncertainty, a model of resource allocation with heterogeneous firms is used to quantify the economic loss from crime and corruption. The estimated aggregate output loss of 12 percent is significantly higher than the 7 percent loss observed in the absence of the resource allocation channel
UR  - http://elibrary.worldbank.org/doi/book/10.1596/1813-9450-8443
ER  -