Establishment exits in Germany: the role of size and age

Journal article


Publication Details

Author(s): Schnabel C, Fackler D, Wagner J
Journal: Small Business Economics
Publisher: Springer Verlag (Germany)
Publication year: 2013
Volume: 41
Journal issue: 3
Pages range: 683-700
ISSN: 0921-898X
eISSN: 1573-0913


Abstract


Using comprehensive data for West Germany, this paper investigates the determinants of establishment exit. We find that between 1975 and 2006 the average exit rate has risen considerably. In order to test various 'liabilities' of establishment survival identified in the literature, we analyzed the impact of establishment size and put a special focus on differences between young and mature establishments. Our empirical analysis shows that the mortality risk falls with establishment size, which confirms the liability of smallness. The probability of exit is substantially higher for young establishments which are not more than 5 years old, thus confirming the liability of newness. There also exists a liability of aging since exit rates first decline over time, reaching a minimum at ages 15-18, and then rise again somewhat. The determinants of exit differ substantially between young and mature establishments, suggesting that young establishments are more vulnerable in a number of ways.


FAU Authors / FAU Editors

Fackler, Daniel
Lehrstuhl für Volkswirtschaftslehre, insbesondere Arbeitsmarkt- und Regionalpolitik
Schnabel, Claus Prof. Dr.
Lehrstuhl für Volkswirtschaftslehre, insbesondere Arbeitsmarkt- und Regionalpolitik


External institutions with authors

Leuphana Universität Lüneburg


Research Fields

Young Firms and Self-Employment
Lehrstuhl für Volkswirtschaftslehre, insbesondere Arbeitsmarkt- und Regionalpolitik
Change in the World of Work
Research focus area of a faculty: Fachbereich Wirtschaftswissenschaften


How to cite

APA:
Schnabel, C., Fackler, D., & Wagner, J. (2013). Establishment exits in Germany: the role of size and age. Small Business Economics, 41(3), 683-700.

MLA:
Schnabel, Claus, Daniel Fackler, and Joachim Wagner. "Establishment exits in Germany: the role of size and age." Small Business Economics 41.3 (2013): 683-700.

BibTeX: 

Last updated on 2018-30-10 at 13:14