Efectos de la productividad y rentabilidad en el desempeño y supervivencia de las empresas manufactureras uruguayas

In a small and open economy productivity is focused from the economic point of view either because exports are needed for country growth or whether is important for the retribution on factors on production. In this context market can be seen as a selection mechanism between firms which allocate bigger shares of the market to more productive firms and reduce shares to the lesser ones, although said mechanism is acting more on profitability than productivity. Using a firm panel of manufacturing firms between 1997 and 2010, profitability is decomposed in a estimation of physical productivity, a estimation on input prices and one on demand shocks, so to observe the effects of these estimations in market dynamics, market share reallocations and market exit probability. This study finds that demand shock and input prices determines reallocations of market share, and that is not the case with physical productivity, and the three factors foretell market exit, although demand shock has a bigger impact on probability of exiting the market.