Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/24022
Authors: 
Prantl, Susanne
Year of Publication: 
2003
Series/Report no.: 
ZEW Discussion Papers 03-72
Abstract: 
Exploiting the unique economic situation after German unification, I investigate how exit decisions deviate between new firms in a transition and a comparatively stable market environment. Two competing exit mechanisms are considered: entrepreneurial self-selection via voluntary liquidation and external selection based on insolvency regulation. Distinguishing between the competing exit modes proves to be crucial in semi-parametric propor- tional hazard-rate estimations. Comparing East and West Germany, I find distinct education and size effects and a higher share of bankruptcy-related liquidations in East Germany. These results are argued to reflect different industry structures, capital and labor market conditions in both parts of Germany.
Subjects: 
Exit
Bankruptcy
Voluntary Liquidation
Transition Economy
Duration Analysis
JEL: 
C14
L20
P30
P52
C41
Document Type: 
Working Paper

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