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Surviving Globalisation

Greenaway, David; Gullstrand, Joakim LU and Kneller, Richard (2008) In Journal of International Economics 74(2). p.264-277
Abstract
This paper investigates the effects of international trade on firms' strategies for industry exit, either via closedown, switching industry or being acquired. We use a rich dataset of Swedish firms that extends over two decades to track firm choices between alternative strategies. We find that higher levels of international competition increase the probability of exit by merger and closedown. If trade is more intra-industry in character, the effect of import penetration on the probability of exit is less. The probability of exit by switching industry is higher in revealed comparative disadvantage industries. Finally, we find that the geographical source of international competition is important, the effects of trade on exit being strongest... (More)
This paper investigates the effects of international trade on firms' strategies for industry exit, either via closedown, switching industry or being acquired. We use a rich dataset of Swedish firms that extends over two decades to track firm choices between alternative strategies. We find that higher levels of international competition increase the probability of exit by merger and closedown. If trade is more intra-industry in character, the effect of import penetration on the probability of exit is less. The probability of exit by switching industry is higher in revealed comparative disadvantage industries. Finally, we find that the geographical source of international competition is important, the effects of trade on exit being strongest when trading partners are other OECD countries. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
Industry dynamics, International trade, Exit, Closure, Merger
in
Journal of International Economics
volume
74
issue
2
pages
264 - 277
publisher
Elsevier
external identifiers
  • wos:000254678800002
  • scopus:39849084225
ISSN
1873-0353
DOI
10.1016/j.jinteco.2007.08.005
language
English
LU publication?
yes
id
1d1dd12a-1f59-44fe-967f-286fe84a5c44 (old id 1384487)
date added to LUP
2009-04-20 12:27:13
date last changed
2017-04-16 03:28:12
@article{1d1dd12a-1f59-44fe-967f-286fe84a5c44,
  abstract     = {This paper investigates the effects of international trade on firms' strategies for industry exit, either via closedown, switching industry or being acquired. We use a rich dataset of Swedish firms that extends over two decades to track firm choices between alternative strategies. We find that higher levels of international competition increase the probability of exit by merger and closedown. If trade is more intra-industry in character, the effect of import penetration on the probability of exit is less. The probability of exit by switching industry is higher in revealed comparative disadvantage industries. Finally, we find that the geographical source of international competition is important, the effects of trade on exit being strongest when trading partners are other OECD countries.},
  author       = {Greenaway, David and Gullstrand, Joakim and Kneller, Richard},
  issn         = {1873-0353},
  keyword      = {Industry dynamics,International trade,Exit,Closure,Merger},
  language     = {eng},
  number       = {2},
  pages        = {264--277},
  publisher    = {Elsevier},
  series       = {Journal of International Economics},
  title        = {Surviving Globalisation},
  url          = {http://dx.doi.org/10.1016/j.jinteco.2007.08.005},
  volume       = {74},
  year         = {2008},
}