Industrial Development through Takeovers and Exits: the Case of the Cut Flower Exporters in Ethiopia
Yukichi Mano () and
No 2013-05, Discussion Papers from Graduate School of Economics, Hitotsubashi University
The exit and takeover of firms influence the structure and economic efficiency of an industry. The existing literature suggests that firms gradually learn about their own productivity. Some stagnate and ultimately exit if they encounter unfavorable prospects; others survive and grow. This selection process implies that the probability of firm exit initially increases with firm age as learning progresses before it eventually falls as learning is completed. We use a firm-level panel of Ethiopia’s cut flower industry to confirm this theoretical implication. The empirical results also suggest that takeover improves productivity and profitability of average firms endowed with a favorable business environment.
New Economics Papers: this item is included in nep-afr and nep-dev
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:hit:econdp:2013-05
Access Statistics for this paper
More papers in Discussion Papers from Graduate School of Economics, Hitotsubashi University Contact information at EDIRC.
Bibliographic data for series maintained by Digital Resources Section, Hitotsubashi University Library ().