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Life Duration of New Firms in Iranian Manufacturing Industries Using Cox Proportional Hazard Model

Author

Listed:
  • Mohammad Ali Feizpour

    (Department of Economics, Business School, Yazd University, Yazd, Iran.)

  • Hossain Hajikhodazadeh

    (Department of Economics, Business School, Yazd University, Yazd, Iran.)

  • Abolfazl Shahmohammadi Mehrjardi

    (Department of Economics, Payame Noor University, Tehran, Iran.)

Abstract

In this paper, the Cox proportional hazard model is used to answer several questions. In general, fourteen variables are applied in four groups: firm, industry, expenditure human resources specific characteristics as well. According to the previous literature in this field, the findings of this paper also show that the factors which affect life duration of firms are different between industries. Summing up, the life duration of manufacturing firm in Iran are positively affected by start-up size, profitability, efficiency, concentration rate, minimum efficient scale, industry growth rate, investment, advertising and education expenditure as well as labor force skills. While, entry rate of firms affect the life duration of firms, inversely. In term of policy, the findings of this paper confirm the importance of industry on the firm’s life duration and the necessity of paying more attention to this variable.

Suggested Citation

  • Mohammad Ali Feizpour & Hossain Hajikhodazadeh & Abolfazl Shahmohammadi Mehrjardi, 2014. "Life Duration of New Firms in Iranian Manufacturing Industries Using Cox Proportional Hazard Model," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 18(3), pages 133-156, Autumn.
    • Handle: RePEc:eut:journl:v:18:y:2014:i:3:p:133
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    References listed on IDEAS

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    1. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1988. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 495-515, Winter.
    2. David B. Audretsch, 1995. "Innovation and Industry Evolution," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011468, December.
    3. Audretsch, David B & Mahmood, Talat, 1995. "New Firm Survival: New Results Using a Hazard Function," The Review of Economics and Statistics, MIT Press, vol. 77(1), pages 97-103, February.
    4. Audretsch, David B, 1991. "New-Firm Survival and the Technological Regime," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 441-450, August.
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    Cited by:

    1. Guimarães Barbosa, Evaldo, 2016. "External determinants of small business survival – The overwhelming impact of GDP and other environmental factors and a new proposed framework," MPRA Paper 73346, University Library of Munich, Germany.

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