Institutions and determinants of firm survival in European emerging markets

Eduard Baumohl, Ichiro Iwasaki and Evžen Kočenda

Journal of Corporate Finance, 2019, vol. 58, issue C, 431-453

Abstract: We analyze the impact of institutional quality on firm survival in 15 European emerging markets. We employ the Cox proportional hazards model with a large dataset of firms during 2006–2015. Our results show that institutional quality (IQ) is a significant preventive factor for firm survival, and it displays diminishing returns as its effect is largest for low-level IQ countries and smallest for high-level IQ countries. In terms of specific indicators, the level of national governance and the extent of corruption control exhibit the key impacts. In terms of firm-specific controls, indicators of ownership structure and aggregate financial performance are the economically most significant factors associated with increased survival probability of firms in European emerging markets.

Keywords: Firm survival; Institutions; European emerging markets; Survival and exit determinants; Hazards model (search for similar items in EconPapers)
JEL-codes: C14 D02 D22 G33 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (34)

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Related works:
Working Paper: Institutions and determinants of firm survival in European emerging markets (2019)
Working Paper: Institutions and Determinants of Firm Survival in European Emerging Markets (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:58:y:2019:i:c:p:431-453

DOI: 10.1016/j.jcorpfin.2019.05.008

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