Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/93534 
Year of Publication: 
2013
Series/Report no.: 
Working Paper Series in Economics No. 288
Publisher: 
Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre, Lüneburg
Abstract: 
This is the first study of the link between internationalization and firm survival during the 2008/2009 crisis in Germany, a country which was hit relatively lightly compared to other countries. Moreover, it is the first study which looks at the role of importing, exporting and FDI simultaneously in the context of a global economic recession. We use a tailor-made representative dataset that covers all enterprises from the manufacturing sector with at least 20 employees. Our most striking result is to demonstrate the disadvantage of exporting for the chances of survival of a firm during the crisis in western Germany. Importing instead reveals a positive correlation with survival and firms that both export and import do not show a different exit risk relative to non-traders. A plausible explanation is that in a global recession, deteriorating markets abroad cause demand losses for exporters and improved conditions on factor markets which result in an advantage for firms sourcing from factor markets abroad. Two-way traders do not show a link with exit risk, supporting the idea that they were able to outweigh their losses from exporting with their gains from importing, in what could be called an export-import hedge. Furthermore, we cannot support the hypothesis that foreign multinationals are more volatile during times of economic crisis.
Subjects: 
Exports
imports
foreign ownership
firm survival
economic crisis
Germany
JEL: 
F23
L60
Document Type: 
Working Paper

Files in This Item:
File
Size
281.98 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.