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Survival probabilities of low value added microenterprises

Author

Listed:
  • Michelle Texis Flores

    () (Universidad Autónoma de Baja California, México)

  • Martín Ramírez Urquidy

    (Universidad Autónoma de Baja California, México)

  • José Gabriel Aguilar Barceló

    (Universidad Autónoma de Baja California, México)

Abstract

This paper analyzes the possibility of survival of low value added microenterprises of Baja California. Using a logit probability model, it was explored various scenarios associated with the possibility that microenterprises exceed the first three years of activity in the market. This is because the theory of entrepreneurship highlight that during those early years, firms are more likely to disappear. The results indicate that microenterprises are more likely to persist in activity when microentrepreneurs have levels of basic education, are married and the microenterprise generates 50% or more of household income. Highlight the effect of schooling level of microentrepreneurs in the possibility of survival of the enterprises, microentrepreneurs who have the highest education level are those with the least probability of lasting in the business. The low value added microenterprises also are related to entrepreneurship by necessity. So, the findings highlight the importance of strengthening microenter rises originated in adverse contexts.

Suggested Citation

  • Michelle Texis Flores & Martín Ramírez Urquidy & José Gabriel Aguilar Barceló, 2016. "Survival probabilities of low value added microenterprises," Contaduría y Administración, Accounting and Management, vol. 61(3), pages 551-567, Julio-Sep.
  • Handle: RePEc:nax:conyad:v:61:y:2016:i:3:p:551-567
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    File URL: http://www.cya.unam.mx/index.php/cya/article/view/1129
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    References listed on IDEAS

    as
    1. Marcus Asplund & Volker Nocke, 2006. "Firm Turnover in Imperfectly Competitive Markets -super-1," Review of Economic Studies, Oxford University Press, vol. 73(2), pages 295-327.
    2. repec:idb:brikps:publication-detail,7101.html?id=23570 is not listed on IDEAS
    3. Agustí Segarra & Maria Callejón, 2002. "New Firms' Survival and Market Turbulence: New Evidence from Spain," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 20(1), pages 1-14, February.
    4. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
    5. Alejandro Mungaray & Martn Ramrez-Urquidy & Michelle Texis & David Ledezma & Natanael Ramrez, 2008. "Learning Economics by Servicing: a Mexican Experience of Service-Learning in Microenterprises," International Review of Economic Education, Economics Network, University of Bristol, vol. 7(2), pages 9-38.
    6. Viego Valentina, 2005. "Empresarialidad e instituciones: dos nuevas perspectivas del analisis regional contemporáneo," Urban/Regional 0511007, University Library of Munich, Germany.
    7. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-670, May.
    8. David B. Audretsch & Roy Thurik, 2001. "Linking Entrepreneurship to Growth," OECD Science, Technology and Industry Working Papers 2001/2, OECD Publishing.
    9. Santa María Mauricio & Sandra Rozo, 2009. "Análisis cualitativo y cuantitativo de la informalidad empresarial en Colombia," REVISTA DESARROLLO Y SOCIEDAD, UNIVERSIDAD DE LOS ANDES-CEDE, September.
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    More about this item

    Keywords

    Microenterprise; Low value added microenterprise; Entrepreneurial; Entrepreneurship by necessity; Survival;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M19 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Other

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