Multinational status and firm exit in the Italian manufacturing and service sectors

Multinational firms and host country market structure: A review of empirical literature

“…7 Additionally, some recent empirical literature also has been concerned in analysing the extent to which foreign owned firms are more likely to exit the market (less likely to survive) than domestic firms (e.g. Mata and Portugal, 2002;Görg and Strobl, 2003;Alvarez and Görg, 2009;Ferragina et al, 2012 In fact a large number of studies have been devoted to the analysis of productivity spillovers arising from multinationals activities, and there are some literature reviews on the topic as in the case of Görg and Strobl (2001) and Iršová and Havránek (2013). 8 The expected relationship between multinational ownership and firm survival is ambiguous (Ferragina et al, 2012).…”

“…Mata and Portugal, 2002;Görg and Strobl, 2003;Alvarez and Görg, 2009;Ferragina et al, 2012 In fact a large number of studies have been devoted to the analysis of productivity spillovers arising from multinationals activities, and there are some literature reviews on the topic as in the case of Görg and Strobl (2001) and Iršová and Havránek (2013). 8 The expected relationship between multinational ownership and firm survival is ambiguous (Ferragina et al, 2012). One the one hand it is expected that MNFs are more likely to exit the market than indigenous firms due to its position within an international production network which allows MNFs to easily relocate production to another country when the business environment in the host country deteriorates.…”

“…10 Several authors (e.g. Görg and Strobl, 2003;Taymaz and Özler, 2007;Burke et al, 2008;Ferragina et al, 2012) specify the hazard function h(t) which is the rate at which plants exit at particular time t given that they have survived in t-1, that is until that time period. As reported by Kosová (2010) and Ferragina et al (2012), a hazard rate lower (higher) than one is associated, ceteris paribus, with a decrease (increase) in the probability of exit or increase (decrease) in the probability of survival.…”

“…Görg and Strobl, 2003;Taymaz and Özler, 2007;Burke et al, 2008;Ferragina et al, 2012) specify the hazard function h(t) which is the rate at which plants exit at particular time t given that they have survived in t-1, that is until that time period. As reported by Kosová (2010) and Ferragina et al (2012), a hazard rate lower (higher) than one is associated, ceteris paribus, with a decrease (increase) in the probability of exit or increase (decrease) in the probability of survival. Note that for Görg and Strobl (2003) and Burke et al (2008) the interpretation of the coefficients is somewhat different: a negative coefficient of the explanatory variable implies that it reduces the rate of hazard or, in other words, increased foreign presence increases the chance of survival.…”

“…Concerning the level of analysis, Tables 3 and 4 show that almost all authors focused on manufacturing industries, and only two studies, Ayyagari and Kosová (2010) and Ferragina et al (2012), also include the services sector. Note that most of the studies are plant or firmlevel studies unlike those focusing on the impact of foreign presence on market concentration analysed in the previous section which are essentially industry-level.…”