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The evolution of new firm's characteristics in Greece before and during the economic adjustment programmes

Author

Listed:
  • Nikos Vettas

    (Foundation for Economic and Industrial Research (IOBE), Athens University of Economics and Business, and Centre for Economic Policy Research, UK)

  • Evangelia Velavanioti

    (Foundation for Economic and Industrial Research (IOBE))

  • Konstantinos Peppas

    (Foundation for Economic and Industrial Research (IOBE))

  • Michail Vasileiadis

    (Foundation for Economic and Industrial Research (IOBE))

Abstract

This paper examines the factors that affect new firms’ survival, growth and export decisions in Greece. Using firm-level data for the 2000-2016 period and the appropriate econometric techniques and performing separate estimations for the pre-crisis and the post-crisis periods (2000- 2007 and 2008-2016), we obtain a number of novel results. The survival estimations highlight the importance of producing technologically advanced and high value-added products that can be competitive in foreign markets and the significance of the regulatory framework under which new firms are established and grow, as well as the central role of bank financing. The estimations of a firm growth model indicate that small, high-leveraged new firms, with poor liquidity, operating in high concentration markets and facing increased credit cost, grow more slowly, although differences in these results are found between the pre-crisis period (2000-2007) and the total period. More experienced firms, as well as those with sufficient liquidity and access to bank finance, have a higher probability to export. The same holds for those firms which are located in large urban areas and are active in knowledge or ICT intensive sectors.

Suggested Citation

  • Nikos Vettas & Evangelia Velavanioti & Konstantinos Peppas & Michail Vasileiadis, 2019. "The evolution of new firm's characteristics in Greece before and during the economic adjustment programmes," Economic Bulletin, Bank of Greece, issue 50, pages 67-109, December.
    • Handle: RePEc:bog:econbl:y:2019:i:50:p:67-109
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    References listed on IDEAS

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    Cited by:

    1. Theodora Kosma & Pavlos Petroulas & Evangelia Vourvachaki, 2020. "What drives wage differentials in Greece: workplaces or workers?," Economic Bulletin, Bank of Greece, issue 52, pages 69-72, December.
    2. Nikos Vettas & Konstantinos Peppas & Sophia Stavraki & Michail Vasileiadis, 2020. "The contribution of Industry to the Greek economy: facts and prospects," Economic Bulletin, Bank of Greece, issue 52, pages 29-67, December.
    3. Ioannis Asimakopoulos & Athanasios P. Fassas & Dimitris Malliaropulos, 2020. "Does earnings quality matter? Evidence from the Athens Exchange," Economic Bulletin, Bank of Greece, issue 52, pages 93-112, December.
    4. Constantina Backinezos & Stelios Panagiotou & Evangelia Vourvachaki, 2020. "Multiplier effects by sector: an input-output analysis of the Greek economy," Economic Bulletin, Bank of Greece, issue 52, pages 7-28, December.

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    More about this item

    Keywords

    new firms; survival; entry; exit; firm growth; firm age; firm size; Cox Proportional Hazard Model; Probit Model; Logit Model; Panel Data Fixed Effects Model;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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