Determinants of firm exit in Slovenian manufacturing

Purpose – This paper sets out to present the determinants of firm exit at the micro firm‐level of Slovenian manufacturing derived from the results of pooled and panel probit models.Design/methodology/approach – Empirical research is conducted on the basis of the Slovenian firm registry data which include virtually all the firms in manufacturing. This data set is complemented with sector level trade data to investigate import competition. A representative panel data set of Slovenian manufacturing firms is used to estimate pooled and panel probit models focusing on the effect of firm specific characteristics, domestic sector and import competition, and financial variables on firm exit. The results of the analysis are compared with research for other countries.Findings – The econometric results show a consistently positive, highly significant effect of import competition offsetting the impact of domestic competition on firm exit. Firm's export orientation, capital intensity, innovation expenditures, firm pro...

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