Age and productivity as determinants of firm survival over the product life cycle

Silviano Esteve Pérez, Fabio Pieri and Diego Rodriguez
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Silviano Esteve Pérez: Department of Applied Economics II, Universitat de València
Diego Rodriguez: Department of Applied Economics II, Universidad Complutense de Madrid
Authors registered in the RePEc Author Service: Silviano Esteve-Pérez

No 1502, Working Papers from Department of Applied Economics II, Universidad de Valencia

Abstract: This paper contributes to fill the gap between the literature on the determinants of firm survival and the theoretical and empirical works on the product life cycle (PLC). Using a representative sample of Spanish manufacturing firms with ten or more employees over the period 1991-2010, we empirically analyze the role played by firm age and productivity on firm survival across three different phases of the PLC to which firms are allocated according to firm- and product-level haracteristics. Firm age results to be negatively and significantly correlated with hazard rates mostly in the ‘young’ phase of the PLC, pointing out the role of ‘learning processes’ in this phase, while firm productivity is associated with lower hazard rates only in the ‘old’ phase of the PLC when market competition is primarily efficiency-driven. Our results qualify the roles of age and productivity as determinants of firm survival.

Keywords: Product life cycle; firm survival; Spanish manufacturing firms; discrete time survival methods (search for similar items in EconPapers)
JEL-codes: C41 L10 L60 (search for similar items in EconPapers)
Date: 2015-04
New Economics Papers: this item is included in nep-bec, nep-com, nep-eff, nep-ent, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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