A BEJEAP Contributions article.

Abstract

This paper provides evidence on the relation between the intensity of product-market competition and the probability of exit. We adopt a natural experiment approach to analyze the impact of a tightening of Swiss antitrust legislation on exit probabilities. Based on a sample of more than 68,000 firms from all major sectors of the Swiss economy, we find that the exit probability of non-exporting firms increased significantly, whereas the exit probability of exporting firms remained largely unaffected. Our results support the notion that there is a positive relationship between the intensity of product-market competition and the probability of exit.

Submitted: April 21, 2005 · Accepted: September 14, 2005 · Published: November 24, 2005

Originally published in Contributions to Economic Analysis & Policy.

Recommended Citation

Buehler, Stefan; Kaiser, Christian; and Jaeger, Franz (2005) "Competition Policy and Exit Rates: Evidence from Switzerland," Contributions to Economic Analysis & Policy: Vol. 4 : Iss. 1, Article 15.
Available at: http://www.bepress.com/bejeap/contributions/vol4/iss1/art15