Selection dynamics in the manufacturing industry during the crisis years: some evidences based on microdata
AbstractThe economic crisis of the late 2000s has led many manufacturing companies to exit the market, due to poor performance or financial difficulties. The purpose of this study is to analyze which characteristics, both static and dynamic, play a role in the shaping of the firms’ exit decision. For this goal, we apply survival analysis techniques to an Italian regional case study, Tuscany, accounting for features of the firms observed both before and during the early years of the crisis. Our findings evidence that the selection process hits companies belonging to supplier-dominated sectors and industrial districts and, more in general, firms that before the crisis were already characterized by a low level of productivity or a poor overall efficiency. Results also suggest that lack of liquidity and inability to cover interest expenses are likely to bring to the exit during the crisis.
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Bibliographic InfoPaper provided by Istituto Regionale per la Programmazione Economica della Toscana in its series Studi e approfondimenti with number 361.
Date of creation: Feb 2012
Date of revision:
business demography; survival; economic crisis;
Find related papers by JEL classification:
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
- G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
- M21 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - Business Economics
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