Tag
firm_survival
3 findings
Economics (general)Frictional Market Survival of Inefficient FirmsIndian woven cotton fabric imports faced a 35% tariff insulating domestic producers, while firm expansion was capped by male family member availability, maintaining low average firm size and wide TFP dispersion (90th-to-10th percentile ratio of 5.0).Observational StudyFirms & operationsProduct Market Competition and Bad Practice SelectionWhereas badly managed firms in competitive economies like the US systematically improve or go bankrupt, low product competition and family ownership in developing countries allow badly managed firms to survive, skewing overall average management scores downwards.Observational StudyFirms & operationsLow Competition and Management Distribution Thick Tail PersistenceDeveloping nations feature lower average management scores driven by a thick tail of persistent, badly run firms that fail to exit, whereas market competition in developed economies forces poorly managed firms to either reform or close down.Observational Study