Dynamic Entry and Exit Linkages in the Brazilian Manufacturing Industry: An Econometric Investigation

21 Pages Posted: 1 May 2013

See all articles by Marcelo Resende

Marcelo Resende

Universidade Federal do Rio de Janeiro (UFRJ); CESifo (Center for Economic Studies and Ifo Institute)

Eduardo P. Ribeiro

Federal University of Rio Grande do Sul - UFRGS

Rodrigo M. Zeidan

NYU Shanghai

Date Written: April 30, 2013

Abstract

The paper investigates dynamic linkages between entry and exit rates in Brazilian manufacturing in the context of 231 (4-digits) industries during the 1996-2005 period. The empirical analysis focuses on the estimation of a dynamic panel data for entry and exit rates and controls for the business cycle. The empirical evidence is consistent with a multiplier effect where synergetic factors prevail either by entry inducing entry or by exit inducing exit. Evidence partially supports a competition effect that could be related to a selection process favouring efficiency, as exit induces entry. The business cycle control variable appears to play no role. The results are similar, though not identical to previous evidence for developed countries.

Keywords: entry and exit rates, dynamic panel data

JEL Classification: L100, C330

Suggested Citation

Resende, Marcelo and Ribeiro, Eduardo P. and Zeidan, Rodrigo M., Dynamic Entry and Exit Linkages in the Brazilian Manufacturing Industry: An Econometric Investigation (April 30, 2013). CESifo Working Paper Series No. 4209. Available at SSRN: https://ssrn.com/abstract=2258360

Marcelo Resende (Contact Author)

Universidade Federal do Rio de Janeiro (UFRJ) ( email )

Rua Sao Francisco Xavier, 524
Instituto de Economia
Rio de Janeiro RJ 21949
Brazil

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Eduardo P. Ribeiro

Federal University of Rio Grande do Sul - UFRGS ( email )

Rio Grande do Sul
Graduate Program in Economics - PPGE Av. Joao Pessoa, 52, sala 33b
Porto Alegre 90040-000
Brazil
55 51 3316 3440 (Phone)
55 51 3316 3507 (Fax)

Rodrigo M. Zeidan

NYU Shanghai ( email )

1555 Century Ave
Shanghai, Shanghai 200122
China

HOME PAGE: http://rzeidan.com

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