Small Firm Death in Developing Countries

David McKenzie and Anna Luisa Paffhausen
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Anna Luisa Paffhausen: University of Passau and World Bank

The Review of Economics and Statistics, 2019, vol. 101, issue 4, 645-657

Abstract: We collate sixteen panel surveys from twelve developing countries to develop stylized facts from over 14,000 firms on how much firm death there is, which types of these firms are most likely to die, and why they die. Small firms die at an average rate of 8.2% per year. Death rates are higher in richer countries, for younger firms and less profitable firms, and for firms run by youth. We also find that firm death need not mean permanent exit from self-employment for the firm owner.

Date: 2019
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Related works:
Working Paper: Small Firm Death in Developing Countries (2017)
Working Paper: Small firm death in developing countries (2017)
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