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The Survival of Manufacturing SMEs in Iran during the Second Development Plan

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  • Mohammad Ali Feizpour

    (Ph.D in Industrial Economics, Business School, Department of Economics, Yazd University, Yazd, Iran, P.O.Box 89195-741)

Abstract

This paper has examined the survival of Small and Medium-sized Enterprises (SMEs) in manufacturing industries in Iran during the years Second Development Plan. For the fist time it uses a large dataset to examine this issue in the context of a developing country. The paper discusses some methodological problems involved and derives estimating model for survival. The results of the paper tend to be consistent with the theories of firm survival, and other empirical work carried out in both developed and developing countries. In the case of the initial plant size, the results show that plant survival is not associated with size. We found that plants with private ownership are more likely to close compared with plants with public ownership. The plants with greater price-cost margin had lower failure rates. Furthermore, plants with a higher proportion of younger workers are less likely to survive, as are those plants with a higher share of female employees. Finally, the concentration ratio has a negative effect but the entry rate has a positive effect.

Suggested Citation

  • Mohammad Ali Feizpour, 2008. "The Survival of Manufacturing SMEs in Iran during the Second Development Plan," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 13(1), pages 53-81, spring.
    • Handle: RePEc:eut:journl:v:13:y:2008:i:1:p:53
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    References listed on IDEAS

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    6. 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.
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