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Can Small Firms' Perceived Constraints Help Explain Survival Rates?

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  • Seán Lyons

    (Economic and Social Research Institute (ESRI))

Abstract

Survey evidence on small firms? perceived constraints might provide useful information on the effects of institutional impediments, such as regulatory burdens, on post-entry performance. Using a new dataset that merges ENSR survey data on small firms? major constraints with Eurostat small firm demography data, we find that some perceived constraints are associated with significant differences in survival rates for new small firms. However, the constraints variables seem only weakly related to survival, and some prominent constraints including administrative regulations and availability of finance are not significant. We suggest refinements in survey design that might improve the usefulness of such data for inter-country comparisons.

Suggested Citation

  • Seán Lyons, 2007. "Can Small Firms' Perceived Constraints Help Explain Survival Rates?," Papers WP182, Economic and Social Research Institute (ESRI).
  • Handle: RePEc:esr:wpaper:wp182
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    File URL: http://www.esri.ie/pubs/WP182.pdf
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    References listed on IDEAS

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    1. Mata, Jose & Portugal, Pedro, 1994. "Life Duration of New Firms," Journal of Industrial Economics, Wiley Blackwell, vol. 42(3), pages 227-245, September.
    2. Astebro, Thomas & Bernhardt, Irwin, 2003. "Start-up financing, owner characteristics, and survival," Journal of Economics and Business, Elsevier, vol. 55(4), pages 303-319.
    3. Nicola Brandt, 2004. "Business Dynamics in Europe," OECD Science, Technology and Industry Working Papers 2004/1, OECD Publishing.
    4. Stefano Scarpetta & Philip Hemmings & Thierry Tressel & Jaejoon Woo, 2002. "The Role of Policy and Institutions for Productivity and Firm Dynamics: Evidence from Micro and Industry Data," OECD Economics Department Working Papers 329, OECD Publishing.
    5. José Mata & Pedro Portugal, 2001. "The Survival of New Domestic and Foreign Owned Firms," Working Papers w200101, Banco de Portugal, Economics and Research Department.
    6. Ruta Aidis, 2005. "Institutional Barriers to Small- and Medium-Sized Enterprise Operations in Transition Countries," Small Business Economics, Springer, vol. 25(4), pages 305-317, November.
    7. Honjo, Yuji, 2000. "Business failure of new firms: an empirical analysis using a multiplicative hazards model," International Journal of Industrial Organization, Elsevier, vol. 18(4), pages 557-574, May.
    8. Nicola Brandt, 2004. "Business Dynamics, Regulation and Performance," OECD Science, Technology and Industry Working Papers 2004/3, OECD Publishing.
    9. Audretsch, David B. & Santarelli, Enrico & Vivarelli, Marco, 1999. "Start-up size and industrial dynamics: some evidence from Italian manufacturing," International Journal of Industrial Organization, Elsevier, vol. 17(7), pages 965-983, October.
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