Export Market Exit and Firm Survival: Theory and First Evidence

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. (2003) model to generate predictions on export market exit and firm survival in a setting where firms endogenously make exit decisions. The central driver of the model dynamics is the inclusion of exogenous economy wide technological progress. The model predicts -inter alia -that a higher relative productivity not only increases the likelihood of exporting, but also the chances of firm survival and continued export market engagements. We relate these predictions to the empirical stylized facts of export market exit and firm survival based on Danish firm-level data. We find strong evidence that firms experience a decline in market share prior to export market exit and prior to death and that the firms discontinuing their exporting activity or closing down tend to be small. Overall, our empirical results support the central predictions from the model. JEL: F12, F15, O33, L11, L16 Terms of use: Documents in

China's export tax rebate and the duration of firm export spells

“…Chen, Li, and Zhou (), Esteve‐Pérez et al. () and Hiller, Philipp, and Sørensen (), respectively, consider the case of China, Spain and Denmark. They find that duration of firm's export destination is significantly affected by the firm size, establishment time, productivity, GDP of the export destination, trade cost and country risk.…”

Should I Stay or Should I Go? Firm Heterogeneity in the Post‐crisis Period

“…They find that hazard rates are lower for firms that are larger, foreign owned and have higher productivity and gearing. Similarly, Hiller et al (2017) and Wagner (2008) using Danish and German data, respectively, also finds that foreign market survival is positively associated with productivity. Ilmakunnas and Nurmi (2010) find that capital-intensive firms in Finnish manufacturing have greater chance of survival in the export market and that foreign ownership can reduce failure rates for small firms and firms with low levels of human capital.…”

Export market exit and financial health in crises periods

“…4 There are also a number of papers that have investigated firm exit from export markets in general (e.g., Girma et al (2003) and Harris and Li (2011) for the UK, Ilmakunnas and Nurmi (2010) for Finland, Hiller et al (2013) for Denmark, and Alvarez and López (2008) for Chile). extension where we look specifically at export exiters that re-enter export markets.…”