Establishment Exits in Germany: The Role of Size and Age
Daniel Fackler (),
Claus Schnabel () and
Joachim Wagner ()
Additional contact information
Daniel Fackler: IWH Halle
No 6349, IZA Discussion Papers from Institute of Labor Economics (IZA)
Using comprehensive data for West Germany, this paper investigates the determinants of establishment exit. We find that between 1975 and 2006 the average exit rate has risen considerably. In order to test various "liabilities" of establishment survival identified in the literature, we analyze the impact of establishment size and put a special focus on differences between young and mature establishments. Our empirical analysis shows that the mortality risk falls with establishment size, which confirms the liability of smallness. The probability of exit is substantially higher for young establishments which are not more than five years old, thus confirming the liability of newness. There also exists a liability of aging since exit rates first decline over time, reaching a minimum at ages 15 to 18, and then rise again somewhat. The determinants of exit differ substantially between young and mature establishments, suggesting that young establishments are more vulnerable in a number of ways.
Keywords: firm exits; Germany (search for similar items in EconPapers)
JEL-codes: L2 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-ent and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed
Published in: Small Business Economics, 2013, 41 (3), 683-700
Downloads: (external link)
Journal Article: Establishment exits in Germany: the role of size and age (2013)
Working Paper: Establishment exits in Germany: the role of size and age (2012)
Working Paper: Establishment exits in Germany: The role of size and age (2012)
Working Paper: Establishment Exits in Germany: The Role of Size and Age (2012)
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:iza:izadps:dp6349
Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Access Statistics for this paper
More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().