The shadow of death: an empirical analysis of the pre-exit performance of young German firms
This paper makes an empirical contribution to confirm the stylized fact that the performance of firms deteoriates in the years before exit. For this reason we evaluate whether market exits differ significantly in their employment development in the years before market drop-out compared to surviving firms that have been selected using a non-parametric matching approach. The matching approach allows to find a surviving firm for every market exit that does not differ in important characteristics measured at start-up. The comparison of the employment growth rates among the thus formed groups reveals that the matched surviving firms experience higher growth rates compared to their exiting counterparts up to three years before market exit. Moreover, we find support for the phenomenon called \shadow of death" sneaking around the corner. A considerable number of firms exiting from 1995 until 1998 has experienced continuing employment losses or at least an employment stagnation over several years before market exit.
|Date of creation:||2000|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.zew.de/
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.:
- Geroski, P. A., 1995. "What do we know about entry?," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 421-440, December.
- Ericson, Richard & Pakes, Ariel, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," Review of Economic Studies, Wiley Blackwell, vol. 62(1), pages 53-82, January.
- G. Steven Olley & Ariel Pakes, 1992.
"The Dynamics of Productivity in the Telecommunications Equipment Industry,"
NBER Working Papers
3977, National Bureau of Economic Research, Inc.
- Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-97, November.
- George S Olley & Ariel Pakes, 1992. "The Dynamics Of Productivity In The Telecommunications Equipment Industry," Working Papers 92-2, Center for Economic Studies, U.S. Census Bureau.
- Schmalensee, Richard, 1989.
"Inter-industry studies of structure and performance,"
Handbook of Industrial Organization,
in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 16, pages 951-1009
- Schmalensee, Richard., 1987. "Inter-industry studies of structure and performance," Working papers 1874-87., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Almus, Matthias & Engel, Dirk & Prantl, Susanne, 2000. "The Mannheim Foundation Panels of the Centre for European Economic Research (ZEW)," ZEW Dokumentationen 00-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Rajan, Raghuram G & Zingales, Luigi, 1998.
"Power in a Theory of the Firm,"
CEPR Discussion Papers
1777, C.E.P.R. Discussion Papers.
- Raghuram G. Rajan & Luigi Zingales, . "Power in a Theory of the Firm," CRSP working papers 335, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Raghuram G. Rajan & Luigi Zingales, 1997. "Power in a Theory of the Firm," NBER Working Papers 6274, National Bureau of Economic Research, Inc.
- Lechner, Michael & Pfeiffer, Friedhelm & Spengler, Hannes & Almus, Matthias, 2000. "The impact of non-profit temping agencies on individual labour market success in the West German state of Rhineland-Palatinate," ZEW Discussion Papers 00-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Susanne Prantl, 2000. "Post-Entry Selection Among Newly Founded Firms in East and West Germany after Unification: A Competing Risk Model with Forced Bankruptcy Liquidations and Voluntary Liquidations," Econometric Society World Congress 2000 Contributed Papers 1602, Econometric Society.
- Adonis Yatchew, 1998. "Nonparametric Regression Techniques in Economics," Journal of Economic Literature, American Economic Association, vol. 36(2), pages 669-721, June.
When requesting a correction, please mention this item's handle: RePEc:zbw:zewdip:5328. 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: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.