Learning from Failure: Organizational Mortality and the Resource-based View
This paper examines the factors underlying firm failure, and compares the failure mechanisms for young firms against those of older organizations. This paper suggests that there are systematic differences between the determinants of firm failure for firms that fail early in life and those that fail after having successfully negotiated the early liabilities of newness and adolescence. Data from 339 Canadian corporate bankruptcies confirm that younger firms fail because of inadequacies in managerial knowledge and financial management abilities. On the other hand, older firms are more likely to fail because of an inability to adapt to environmental change.
|Date of creation:||08 Aug 2003|
|Contact details of provider:|| Postal: Tunney's Pasture, Ottawa, Ontario, K1A 0T6|
Web page: http://www.statcan.gc.ca
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Brush, Candida G. & Chaganti, Radha, 1999. "Businesses without glamour? an analysis of resources on performance by size and age in small service and retail firms," Journal of Business Venturing, Elsevier, vol. 14(3), pages 233-257, May.
- Stearns, Timothy M. & Carter, Nancy M. & Reynolds, Paul D. & Williams, Mary L., 1995. "New firm survival: Industry, strategy, and location," Journal of Business Venturing, Elsevier, vol. 10(1), pages 23-42, January.
- Alfred R Nucci & Timothy Bates, 1990. "An Analysis of Small Business Size and Rate of Discontinuance," Working Papers 90-2, Center for Economic Studies, U.S. Census Bureau.
- Venkataraman, S. & Van De Ven, Andrew H. & Buckeye, Jeanne & Hudson, Roger, 1990. "Starting up in a turbulent environment: A process model of failure among firms with high customer dependence," Journal of Business Venturing, Elsevier, vol. 5(5), pages 277-295, September.
- Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
- Cooper, Arnold C. & Gimeno-Gascon, F. Javier & Woo, Carolyn Y., 1994. "Initial human and financial capital as predictors of new venture performance," Journal of Business Venturing, Elsevier, vol. 9(5), pages 371-395, September.
- Levinthal, D.A. & Fichman, M., 1991. "Honeymoons and the Liability of Adolescence : A New Perspective on Duration Dependence in Social Organizational Relationships," GSIA Working Papers 1991-34, Carnegie Mellon University, Tepper School of Business.
- Richard A. D'Aveni, 1989. "Dependability and Organizational Bankruptcy: An Application of Agency and Prospect Theory," Management Science, INFORMS, vol. 35(9), pages 1120-1138, September.
- Bates, Timothy, 1990. "Entrepreneur Human Capital Inputs and Small Business Longevity," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 551-59, November.
When requesting a correction, please mention this item's handle: RePEc:stc:stcp3e:2003202e. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Brown)
If references are entirely missing, you can add them using this form.