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A competing risks analysis of firms’ exit

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Abstract

Firms may exit the market in several ways and each form of exit is likely to be caused by different factors (Schary in RAND J Econ 22:339–353, 1991). This paper explores the determinants of different exit routes. Using a sample of Spanish manufacturing firms for 1990–2000, we estimate a competing risks proportional hazards model to identify the factors leading firms to exit the market through (the mutually precluding events of) liquidation/bankruptcy and acquisition/merger. Our results show the existence of a sharp difference between the determinants of these two exit routes in terms of firm and industry characteristics.

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Authors and Affiliations

  1. Universidad de Valencia, Valencia, Spain

    Silviano Esteve-Pérez, Amparo Sanchis-Llopis & Juan A. Sanchis-Llopis

  2. Departamento de Economia Aplicada II, Facultad de Economia, Edificio Departamental Oriental, Avenida de los Naranjos, s/n, 46022, Valencia, Spain

    Silviano Esteve-Pérez

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  1. Silviano Esteve-Pérez
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  2. Amparo Sanchis-Llopis
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  3. Juan A. Sanchis-Llopis
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Correspondence to Silviano Esteve-Pérez.

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Esteve-Pérez, S., Sanchis-Llopis, A. & Sanchis-Llopis, J.A. A competing risks analysis of firms’ exit. Empir Econ 38, 281–304 (2010). https://doi.org/10.1007/s00181-009-0266-x

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