EconPapers    
Economics at your fingertips  
 

Corporate zombies: Anatomy and life cycle

Ryan Banerjee and Boris Hofmann

No 882, BIS Working Papers from Bank for International Settlements

Abstract: Using firm-level data on listed non-financial companies in 14 advanced economies, we document a rise in the share of zombie firms, defined as unprofitable firms with low stock market valuation, from 4% in the late 1980s to 15% in 2017. These zombie firms are smaller, less productive, more leveraged and invest less in physical and intangible capital. Their performance deteriorates several years before zombification and remains significantly poorer than that of non-zombie firms in subsequent years. Over time, some 25% of zombie companies exited the market, while 60% exited from zombie status. However, recovered zombies underperform compared to firms that have never been zombies and they face a high probability of relapsing into zombie status.

Keywords: zombie companies; firm behaviour; economic dynamism; productivity growth; bankruptcy (search for similar items in EconPapers)
JEL-codes: D22 D24 E43 G33 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2020-09
New Economics Papers: this item is included in nep-bec, nep-eff, nep-ent, nep-fdg, nep-mac and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (43)

Downloads: (external link)
https://www.bis.org/publ/work882.pdf Full PDF document (application/pdf)
https://www.bis.org/publ/work882.htm (text/html)

Related works:
Journal Article: Corporate zombies: anatomy and life cycle (2022) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bis:biswps:882

Access Statistics for this paper

More papers in BIS Working Papers from Bank for International Settlements Contact information at EDIRC.
Bibliographic data for series maintained by Martin Fessler ().

 
Page updated 2025-03-30
Handle: RePEc:bis:biswps:882