Do International Shocks Affect Small Wholesalers and Retailers?
AbstractPrevious research has suggested that the smallest firms are those most vulnerable to international competition, as measured by exchange rate fluctuations and import shares. However, that work – and the overwhelming bulk of the empirical literature on determinants of exit or firm survival – dealt entirely with the manufacturing sector of the economy. Are firms further down the distribution chain, small wholesalers and retailers, hurt by real exchange rate movements? Annual data for 1989-2005 are analyzed to explain small firm exit rates in several employment size categories – under 10 employees, 10-19 employees, 20-99 employees, and 100-499 employees. While there is variation across industry sectors, the basic result is that wholesalers respond negatively to a stronger currency in a manner similar to that of manufacturers, while retailers are generally unaffected.
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Bibliographic InfoPaper provided by American University, Department of Economics in its series Working Papers with number 2009-02.
Date of creation: Mar 2009
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Other versions of this item:
- Robert Feinberg, 2010. "Do international shocks affect small wholesalers and retailers?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 146(2), pages 323-338, June.
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
- L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
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