Harris, R.I.D. and Li, Q.C. (2010) Export-market dynamics and the probability of firm closure: evidence for the United Kingdom. Scottish Journal of Political Economy, 57(2), pp. 145-168. (doi: 10.1111/j.1467-9485.2010.00511.x)
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Abstract
This study presents the first empirical analysis of the determinants of firm closure in the United Kingdom with an emphasis on the role of export-market dynamics, using panel data for a nationally representative group of firms operating in all-market-based sectors during 1997–2003. Our findings show that the probability of closure is (cet. par.) significantly lower for exporters, particularly those experiencing export-market entry and exit. Having controlled for other attributes associated with productivity (such as size and export status), the following factors are found to increase the firm's survival prospects: higher capital intensity and TFP, foreign ownership, young age, displacement effects (through relatively high rates of entry of firms in each industry), and belonging to certain industries. Interestingly, increased import penetration (a proxy for lower trade costs) leads to a lower hazard rate for exporting entrants and continuous exporters, while inducing a higher hazard rate for domestic producers or those that quit exporting.
| Item Type: | Articles |
|---|---|
| Status: | Published |
| Refereed: | Yes |
| Glasgow Author(s) Enlighten ID: | Li, Miss Qian and Harris, Prof Richard |
| Authors: | Harris, R.I.D., and Li, Q.C. |
| Subjects: | H Social Sciences > HB Economic Theory |
| College/School: | College of Social Sciences > Adam Smith Business School > Economics |
| Journal Name: | Scottish Journal of Political Economy |
| ISSN: | 0036-9292 |
| ISSN (Online): | 1467-9485 |
| Published Online: | 08 March 2010 |
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